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Winter Is Coming: Why Our National Debt Is Illegitimate, Unjust and Unsustainable…and Why We Should Be Worried

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Greece teaches us, if we will listen, that the time is likely to come when Kenya will be unable to pay government workers’ salaries and will not be able to fund essential public services, such as security. At this point, the Government of Kenya will be forced to take on yet more borrowing to prevent a mass uprising. These “rescue packages” will be offered on grossly usurious terms, terms that the government will have no choice but to accept.

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Winter Is Coming: Why Our National Debt Is Illegitimate, Unjust and Unsustainable…and Why We Should Be Worried
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Recently the matter of Kenya’s national indebtedness has gained wide coverage in the media, not least in a presidential roundtable with the press on December 28th, 2018. In my opinion, our nation is grossly indebted, and in fact we are in a de facto state of emergency as far as our nation’s finances are concerned. I hope to demonstrate this fact below, and to suggest what options we have for dealing with our indebtedness.

Several indicators for measuring national indebtedness exist, such as Debt-to-Gross Domestic Product (Debt:GDP), debt per capita, etc. Probably the most widely-used indicator is the Debt:GDP ratio. This particular metric is so obfuscatory and misleading that it is not inconceivable that it was actually developed to mask the truth about national indebtedness the world over.

When we as individuals want to borrow salary-backed loans from banks, the banks attempt to assess our ability to pay off these loans by reviewing our payslips, sometimes going back 3 to 6 months. This effort is calculated to answer just one question: what is our take-home pay? In doing this, the banks are assessing our credit-worthiness, which helps to reduce the risk of default.

At the national level, however, this abundance of caution is thrown to the wind. The use of the Debt:GDP ratio to measure national indebtedness means that a country’s ability to take on more debt is assessed on the basis of its GDP. At an individual level, such an assessment would approximate assessing our ability to pay off salary-backed loans based on our gross pay. In fact, it is much worse: it is more like assessing an individual’s ability to pay off a loan based on how much revenue he generates for his employer. Even if such a company is just breaking even, the revenue an employee earns his employer must necessarily exceed his salary, or else that organisation would be unable to meet its operational costs, such as rent, electricity and other office expenses. Put another way, the revenue an employee generates pays a lot more than his salary). Since GDP attempts (poorly) to measure the total value generated by all the economic activity in a nation, to use it as a basis for measuring whether a country has room to borrow is patently unwise simply because not all the value created in a nation’s economy is available to pay a nation’s debt.

The revenue employees generate and the value an economy generates (GDP) are analogous in that both are measures of value created. However, whereas the revenue produced by employees accrues directly to their employers’ GDP, it does not so directly accrue to a nation. For example, after a loaf of bread has been produced in a country, that loaf is not submitted to the government, yet its production adds to the nation’s GDP. For this reason, even a revenue-based definition of employees’ income does not properly approximate the absurdity of using GDP as a measure of national income on which to assess indebtedness because not all of GDP accrues to the nation as income.

By masking true indebtedness, therefore, the Debt:GDP ratio encourages wanton borrowing. This works in favour both of fiscally irresponsible (or worse, corrupt) governments and of predatory lenders…

What is the net effect of all this? The more broadly a lender can define a borrower’s income, the larger the proportion of that borrower’s true income that will flow out as loan repayments, and the more the borrower’s assets stand at risk of repossession as collateral. This is what has happened to us as a nation. When we consider further stratagems like rebasing our GDP, which had the effect of increasing our GDP by 25% at a stroke, it can be seen that by nominally increasing our GDP the illusion was given that our nation was able to take on even more borrowing than before, opening the gates to yet more lending.

By masking true indebtedness, therefore, the Debt:GDP ratio encourages wanton borrowing. This works in favour both of fiscally irresponsible (or worse, corrupt) governments and of predatory lenders, both private and multilateral (the line between private and multilateral lenders is far thinner than is generally believed). We do not pay debt out of GDP. We pay debt out of our national revenues. The more revealing and honest measure would be debt-to-national revenue. For the same reasons of honesty and clarity, it is prudent to narrow the definition of national revenue down further to tax revenue, thereby eliminating grants, donations, monies realised from the sale of public assets, and other incidentals from the discussion.

The problem – from the viewpoint of irresponsible governments and predatory lenders, of course – is that once we do so, the scales will fall off our eyes and it becomes apparent just how much of our nation’s money is going towards servicing our debt. According to the national Treasury, our national debt, which stood at Sh1.894 trillion in the financial year (FY) 2013, had grown to Sh5.047 trillion by the end of FY 2018, a growth of 269 per cent.

In 2013, however, the government collected a total of Sh754.2 billion in taxes. The implication is that our Debt:Tax ratio stood at a whopping 251 per cent in that year. By 2018, although revenue collections had grown to Sh1.47 trillion, our debt had grown much faster, so much so that our Debt:Tax ratio in the FY 2018 stood at 343 per cent.

Our GDP in 2013, according to the same report, was Sh4.496 trillion, meaning our Debt:GDP ratio was 42.1 per cent in 2013. In 2018, our GDP was Sh8.845 trillion. (This suggests that our GDP has been growing at a compounded annual growth rate of 14.49 per cent, which would be news to most Kenyans; the effect of rebasing our GDP can now more clearly be seen.) These figures imply our Debt:GDP ratio in FY 2018 was 57 per cent.

In 2013, however, the government collected a total of Sh754.2 billion in taxes. The implication is that our Debt:Tax ratio stood at a whopping 251 per cent in that year. By 2018, although revenue collections had grown to Sh1.47 trillion, our debt had grown much faster, so much so that our Debt:Tax ratio in the FY 2018 stood at 343 per cent. In other words, if the Government did nothing else but pay off our national debt – if it did not pay teachers, doctors, nurses, the army, and the police; if it did not provide medical supplies; if it bought no textbooks; if it did not construct one metre of road or railway; if it did not construct one hospital room or classroom or police post – it would take us about three and a half years to pay off the national debt.

Table 1: Kenya's Debt:GDP vs Debt:Tax ratio, FYs 2013 - 2018

Table 1: Kenya’s Debt:GDP vs Debt:Tax ratio, FYs 2013 – 2018

This situation is untenable. National Treasury data indicates that in FY 2018 we spent Sh459.4 billion servicing our debt. By that measure, debt repayment was the single largest item in our nation’s expenditure, exceeding our expenditure on transport infrastructure (Sh225 billion), health (Sh65.5 billion) or education (Sh415.3 billion). In other words, we are spending more paying off our debt than we are spending providing good transport for our people and good treatment for our sick – combined.

A day of reckoning is soon coming for our beloved country, on which day we shall realise that indeed, as per the Holy Writ, “…the borrower is slave to the lender”, and that debt (even if the money is used well, let alone if it is actively misused as we have done) is the tool of the neo-colonialist. It will become starkly apparent that by a system of multilateral and international debt, there is a sense in which foreign powers have been able to be perhaps as extractive of our nation’s wealth as they were when they were in power as our colonial masters. There is in fact a very real sense in which the colonial powers never really left. The only major change is that China is now on the list of our foreign masters.

We have already seen multilateral lenders like the International Monetary Fund (IMF) force our government to impose VAT on fuel. This is not the first time this happened. In 2013, when our debt was less than half what it is now, the IMF backed changes in our VAT law that would have imposed VAT on milk and medicines, claiming that “…the changes in the law [would] put Kenya in line with other modern VAT regimes in the world by simplifying the way it operates while reducing the number of exempt items.” Although the Cabinet did not impose VAT on milk and medicines, other items, such as textbooks, periodicals and magazines, did not escape the taxman’s levy. The press reported that our national port in Mombasa was used as a security for the loan that was used to construct the Standard Gauge Railway (SGR). These are not isolated bellwethers of the dire situation our country finds herself in: the Daily Nation recently reported that we will require Sh1.04 trillion to service our debt in FY 2020. Where will it come from?

We must now examine possible solutions to what is clearly a monumental problem. The truth is this: debt can be dealt with either by paying it, or by not paying it. National debt can be repaid through austerity programmes and/or by the realisation of collateral. A nation may avoid repayment by pursuing debt forgiveness; defaulting on our sovereign debt; and/or overseeing a managed default on our sovereign debt.

Options for paying our national debt

Austerity programmes

Since the national debt can only be paid out of taxes, an escalation of the national debt can only result in an austerity programme. Austerity is a term that follows a very well-worn path of giving nasty, anti-common man policies honourable names (this is what is called “Economese”). Simply put, austerity necessitates the redirection of large portions of tax receipts away from normal government expenditure (including mission-critical social expenditure like health and education, and away from development expenditure) in an effort to pay off the debt. The Merriam-Webster dictionary describes austerity as “enforced or extreme economy”.

The fact that Kenya is – whether it has publicly announced it or not – well up the austerity road is evidenced by the earlier observation that debt repayment is the single largest item in our nation’s budget. By the time our lenders and leaders decide to announce that we are in an austerity programme, we will have been in one for years.

To examine where this road leads, we must turn to Greece. That nation has been locked in austerity’s deathly embrace for the better part of a decade. An Al Jazeera article notes that the austerity programme in Greece was occasioned by over-borrowing (sound familiar?) in the years leading up to the global financial crisis, which was exacerbated by a rise in rates occasioned by that crisis. In order to keep paying government salaries and finance public services, Greece had to accept an initial loan of EUR110 billion from its Eurozone partners and the IMF. To pay off this loan, the country was compelled to institute radical austerity measures. How did that go?

In August 2018, the Guardian summarized Greece’s experience thus:

The European Union, the European Central Bank and the International Monetary Fund loaned Greece a total of €289bn ($330bn) in three programmes, in 2010, 2012 and 2015.

The economic reforms the creditors demanded in return brought the country to its knees with a quarter of its gross domestic product (GDP) evaporating over eight years and unemployment soaring to more than 27%.

The fundamental contradictions between the envisaged outcomes of austerity and its outcomes in reality are also the reason we find multilateral lenders talking out of both sides of their mouths, first imposing these programmes, and then sheepishly admitting that they have not worked. The IMF, for example, actually produced a report stating that it made notable failures on its first rescue package to Greece.

Greece teaches us, if we will listen, that the time is likely to come when Kenya will be unable to pay government workers’ salaries and will not be able to fund essential public services, such as security. At this point, the Government of Kenya will be forced to take on yet more borrowing to prevent a mass uprising. These “rescue packages” will be offered on grossly usurious terms, terms that the government will have no choice but to accept. Then, in a strange twist of irony, the very people upon whom the initial injustices were visited will do the lenders’ marketing for them by way of a civil uprising. From then on, our nation’s expenditure will be “supervised” by these lenders, not to help the Kenyan people, but to ensure that these lenders are paid. These are doomsday scenarios, and I find it difficult to even write them. Yet it can get worse – and has, elsewhere in the world.

Realisation of collateral

Realisation of collateral is a method of debt payment that is as old and as basic as Shylocks. It is difficult to recall a time when national debt was collateralised to the extent that has happened in the recent past. It appears that the realisation of collateral appears to be the favoured method of China for collecting debt. For our case study on this, we must turn to the nation of Sri Lanka, as the New York Times reported:

Every time Sri Lanka’s president, Mahinda Rajapaksa, turned to his Chinese allies for loans and assistance with an ambitious port project, the answer was yes.

Yes, though feasibility studies said the port wouldn’t work. Yes, though other frequent lenders like India had refused. Yes, though Sri Lanka’s debt was ballooning rapidly under Mr. Rajapaksa.

…Mr. Rajapaksa was voted out of office in 2015, but Sri Lanka’s new government struggled to make payments on the debt he had taken on. Under heavy pressure and after months of negotiations with the Chinese, the government handed over the port and 15,000 acres of land around it for 99 years in December [2017].

There are examples closer to home. In December 2018, the US National Security Advisor, John Bolton, sensationally claimed that China was about to take over the Zambia Electricity Supply Corporation (ZESCO), which is Zambia’s version of Kenya Power & Lighting Company, before KenGen and Ketraco were hived off. Although this rumour was strongly refuted by Zambia’s presidential spokesman, Mr Amos Chanda, Mr Chanda did admit that Zambia owes China US$3.1 billion in debt. In Africa that kind of statement from that kind of person often means the figure is much higher; indeed, some sources have placed the figure at US$6.4 billion.

In 2017, Zambia’s police force had to scrap plans to hire eight Chinese nationals following a public outcry. Zambians were concerned about having to salute a Chinese national in their own country. It is also true that in November 2018 police arrested over 100 residents in Kitwe (the country’s second-largest city) who were protesting the alleged sale of the Zambia Forestry and Forest Industries Corporation (ZAFFICO). There is a possible sub-plot here: Mr Bolton’s claim may mean that the IMF and Western allies are worried that they are losing their grip on the Zambian nation to China.

Options for not paying our national debt

In advocating for the non-payment of national debt I am not advocating injustice or dishonesty for this reason: “The government” is not a nebulous entity separate from the people. The government is the people. When the government borrows, it is the people who are borrowing; when the government pays, it is the people who must pay; indeed, it is their taxes that are used to pay.

As can be seen from the foregoing, over-borrowing, poor governance and/or the mismanagement of public funds can lead to adverse effects, not on “the government”, not on the lenders – even private lenders – but on the people. The stark truth is that austerity rarely, if ever, aids recovery – unless by recovery we mean the recovery of lenders’ money.

As can be seen from the foregoing, over-borrowing, poor governance and/or the mismanagement of public funds can lead to adverse effects, not on “the government”, not on the lenders – even private lenders – but on the people. The stark truth is that austerity rarely, if ever, aids recovery – unless by recovery we mean the recovery of lenders’ money. Austerity is a creditor-oriented policy, not a people-oriented policy, and it fails because cuts in government spending result in reduced consumption, unemployment and lower tax receipts. Yet tax receipts are what are needed in order to pay off the debt. The realisation of collateral (the other solution) is nothing but the seizure of a people’s land

There exists, therefore, a moral case for non-payment, which is this: that the betrayal of a people by its ruling class through the accumulation of a debt whose benefits the people never realised should not be visited upon the class of the ruled, who pay the debt. On this point, therefore, I am advocating for justice, not injustice; and for honesty, not dishonesty.

Debt forgiveness

Debt forgiveness is not a new concept; it is in fact a biblical concept. The concept of Jubilee meant that every 50 years, during the eponymously-named Jubilee year, all debts were written off, all enslavement ended, and everyone was allowed to return to whatever ancestral lands that they might have had to give up because of an inability to pay back debt. A thorough examination of the wisdom and justice of this law would take up a solid chapter in a good book; suffice it to say that it acted like a legislated revolution, resetting the kind of gross national inequalities that US Senator Bernie Sanders is grappling with – for the price of a trumpet blast.

Our gross national indebtedness means – or rather, dictates – that we pursue debt forgiveness, because we simply cannot pay back everything we have borrowed. The problem is that we are not considered a poor country any more – not even a low-income country. We are now a middle income nation, and precedent shows that debt forgiveness is the preserve of highly indebted poor countries. Our pleas for debt forgiveness, therefore, are quite likely to fall on deaf ears. Further, a significant portion of our national debt is owed to China and China, Sri Lanka might whisper, is not a nation one asks for forgiveness.

A note of caution must here be sounded: only 15 or so years ago, Zambia had its debts wiped clean under the IMF’s Heavily Indebted Poor Countries scheme. The same country then took “less than a decade” to run up fresh debt of 59 per cent of GDP, buying million-dollar fire engines and constructing roads twice as expensive as those of her neighbours.

A strategy of debt forgiveness is, therefore, useless in the absence of enforced legislation to ensure that future over-indebtedness and/or wastage is prevented. A law preventing the government from tying up more than 10 per cent to 15 per cent of the average tax collected in the previous five years on debt servicing would be a very good place to start. The laws preventing wastage and theft of what we actually do borrow do exist, but require radical enforcement.

Default on sovereign debt

There exist exceptional circumstances in which nations default on their national debt. These times are usually presaged by significant external shocks or political ones, such as when Fidel Castro took over in Cuba in 1959, and simply defaulted on outstanding Cuban debt. The bonds on which he defaulted are in default to date.

Reference is often made to the Argentinian default (and one must be specific) of 2001. In 1998, Argentina’s economy entered a deep recession. The IMF’s by now predictable solution, of course, was austerity. Over the course of the following two years, it became increasingly clear that the toxic mix of an artificially fixed exchange rate, a steadily worsening balance of payments deficit (imports exceeding exports) and mounting debt, among other factors, meant that Argentina would never be able to pay off its debt.

Then the people began to protest, with increasing vociferousness, against austerity. When in December 2001 the IMF realised that default could not be avoided, it held back previously promised “support” so that the government was left without any external funding. Bank runs and riots followed: at one point the country had five presidents in ten days. Finally, on December 24, the country defaulted on a US$ 100 billion debt. This led to a social crisis of epic proportions, characterised not least by rampant unemployment.

Sovereign defaults of this nature tend to be devastating and ought to be avoided. The social cost ends up being far too high, even if one is a Castro leading a non-conformist Cuba. Firstly, in order to teach other would-be defaulters a lesson, lenders make an example out of one. Secondly, the world has become too interconnected for us to make ourselves a pariah state for any length of time: globalisation is a source of many ills, but it can help us as well, for we have a surplus of labour that we can offer the world (among other competitive advantages).

Managed default on sovereign debt

The way we might want to do it is the way Ecuador did it between 2007 and 2009. The then President Rafael Correa stopped payments on bonds that the country had taken out, and established a “debt audit commission” to conduct an audit on the country’s debt, which at the time was using up 38 per cent of the government’s budget. The purpose of this audit was to establish the “legitimacy” of the debt.

This was a brilliant first step. Firstly, it brought to the forefront the moral injustice of a people’s having to pay loans from which they never benefitted. Secondly, the reason given for the initial default was a moral one, as opposed to a financial one (even though the financial reasons lurk menacingly in the background). The genius behind the debt audit was that it was for establishing the morality (and not merely the affordability) of the public debt. Such a debt audit commission in Kenya – objective, apolitical (in a local sense), staffed with technically qualified, patriotic individuals and with an ability to trace the flows of borrowed funds – would likely produce spectacular results.

The way we might want to do it is the way Ecuador did it between 2007 and 2009. The then President Rafael Correa stopped payments on bonds that the country had taken out, and established a “debt audit commission” to conduct an audit on the country’s debt, which at the time was using up 38 per cent of the government’s budget. The purpose of this audit was to establish the “legitimacy” of the debt.

Ecuador’s debt audit commission found that the debt was illegitimate based on the manner in which negotiations were conducted. (The reasons for which debt can be illegitimate are myriad: here in Kenya, the factors would range from non-existence of the assets ostensibly purchased with the debt, overpricing of assets that do exist, payment of bribes and kickbacks, and lack of public participation and parliamentary approval, etc.) Arising from the stopped payments, and from the public establishment of the illegitimacy of the debt, the value of the bonds on the open market plunged. The Government of Ecuador then tendered to repurchase the bonds at 30 cents on the dollar. On the basis of the auction results, the government then offered to buy back the bonds at 35 cents on the dollar, expecting to retire at least 75 per cent of the bonds. Ninety-one per cent of the bonds were so retired in June 2009, that the government paid off its public debt for about a third of what it was worth and, according to President Correa, saved US$ 300M (Sh30 billion) per year in interest payments.

The Ecuadorian solution has an elegance that only simplicity gives. However, its success needs to be assessed against the backdrop of an important contextual factor: the retirement of the country’s debt happened at a time when markets were in the throes of the global financial crisis. Investors, therefore, were under pressure to liquidate their assets. Further, how successful this method would be as regards Chinese debt is anyone’s guess: simple and easy are vastly different things.

That said, the process presents a blueprint for any government that is ready and willing to ease the burden of over-indebtedness and is an option and a strategy this country should pursue – before it’s too late.

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The author is a Christian, a patriot and a financial professional. He tweets at @Chrenyan

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Hijacking Kenya’s Health Spending: Companies Linked to Powerful MP Received Suspicious Procurement Contracts

Two obscure companies linked to Kitui South MP Rachael Kaki Nyamai were paid at least KSh24.2 million to deliver medical supplies under single-source agreements at the time the MP was chair of the National Assembly’s Health Committee.

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Hijacking Kenya’s Health Spending: Companies Linked to Powerful MP Received Suspicious Procurement Contracts
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Two obscure companies linked to Kitui South MP Rachael Kaki Nyamai were paid at least KSh24.2 million to deliver medical supplies under single-source agreements at the time the MP was chair of the National Assembly’s Health Committee, an investigation by Africa Uncensored and The Elephant has uncovered.

One of the companies was also awarded a mysterious Ksh 4.3 billion agreement to supply 8 million bottles of hand sanitizer, according to the government’s procurement system.

The contracts were awarded in 2015 as authorities moved to contain the threat from the Ebola outbreak that was ravaging West Africa and threatening to spread across the continent as well as from flooding related to the El-Nino weather phenomenon.

The investigation found that between 2014 and 2016, the Ministry of Health handed out hundreds of questionable non-compete tenders related to impending disasters, with a total value of KSh176 billion including three no-bid contracts to two firms, Tira Southshore Holdings Limited and Ameken Minewest Company Limited, linked to Mrs Nyamai, whose committee oversaw the ministry’s funding – a clear conflict of interest.

Number of Suppliers Allocated BPAAlthough authorities have since scrutinized some of the suspicious contracts and misappropriated health funds, the investigation revealed a handful of contracts that were not made public, nor questioned by the health committee.

Mrs Nyamai declined to comment for the story.

Nyamai has been accused by fellow members of parliament of thwarting an investigation of a separate alleged fraud. In 2016, a leaked internal audit report accused the Ministry of Health — colloquially referred to for its location at Afya House — of misappropriating funds in excess of nearly $60 million during the 2015/2016 financial year. Media stories described unauthorized suppliers, fraudulent transactions, and duplicate payments, citing the leaked document.

Members of the National Assembly’s Health Committee threatened to investigate by bringing the suppliers in for questioning, and then accused Nyamai, the committee chairperson, of blocking their probe. Members of the committee signed a petition calling for the removal of Nyamai and her deputy, but the petition reportedly went missing. Nyamai now heads the National Assembly’s Committee on Lands.

Transactions for companies owned by Mrs Nyamai’s relatives were among 25,727 leaked procurement records reviewed by reporters from Africa Uncensored, Finance Uncovered, The Elephant, and OCCRP. The data includes transactions by eight government agencies between August 2014 and January 2018, and reveals both questionable contracts as well as problems that continue to plague the government’s accounting tool, IFMIS.

The Integrated Financial Management Information System was adopted to improve efficiency and accountability. Instead, it has been used to fast-track corruption.

Hand sanitizer was an important tool in fighting transmission of Ebola, according to a WHO health expert. In one transaction, the Ministry of Health paid Sh5.4 million for “the supply of Ebola reagents for hand sanitizer” to a company owned by a niece of the MP who chaired the parliamentary health committee. However, it’s unclear what Ebola reagents, which are meant for Ebola testing, have to do with hand sanitizer. Kenya’s Ministry of Health made 84 other transactions to various vendors during this period, earmarked specifically for Ebola-related spending. These included:

  • Public awareness campaigns and adverts paid to print, radio and tv media platforms, totalling at least KSh122 million.
  • Printed materials totalling at least KSh214 million for Ebola prevention and information posters, contact tracing forms, technical guideline and point-of-entry forms, brochures and decision charts, etc. Most of the payments were made to six obscure companies.
  • Ebola-related pharmaceutical and non-pharmaceutical supplies, including hand sanitizer
  • Ebola-related conferences, catering, and travel expenses
  • At least KSh15 millions paid to a single vendor for isolation beds

Hacking the System

Tira Southshore Holdings Limited and Ameken Minewest Company Limited, appear to have no history of dealing in hygiene or medical supplies. Yet they were awarded three blanket purchase agreements, which are usually reserved for trusted vendors who provide recurring supplies such as newspapers and tea, or services such as office cleaning.

“A blanket agreement is something which should be exceptional, in my view,” says former Auditor-General, Edward Ouko.

But the leaked data show more than 2,000 such agreements, marked as approved by the heads of procurement in various ministries. About KSh176 billion (about $1.7 billion) was committed under such contracts over 42 months.

“Any other method of procurement, there must be competition. And in this one there is no competition,” explained a procurement officer, who spoke generally about blanket purchase agreements on background. “You have avoided sourcing.”

The Ministry of Health did not respond to detailed questions, while Mrs Nyamai declined to comment on the contracts in question.

Procurement experts say blanket purchase agreements are used in Kenya to short-circuit the competitive process. A ministry’s head of procurement can request authority from the National Treasury to create blanket agreements for certain vendors. Those companies can then be asked by procurement employees to deliver supplies and services without competing for a tender.

Once in the system, these single-source contracts are prone to corruption, as orders and payments can simply be made without the detailed documentation required under standard procurements. With limited time and resources, government auditors say they struggle especially with reconciling purchases made under blanket agreements.

The agreements were almost always followed by standard purchase orders that indicated the same vendor and the same amount which is unusual and raises fears of duplication. Some of these transactions were generated days or weeks after the blanket agreements, many with missing or mismatched explanations. It’s unclear whether any of these actually constituted duplicate payments.

For example, the leaked data show two transactions for Ameken Minewest for Sh6.9 million each — a blanket purchase order for El Nino mitigation supplies and a standard order for the supply of chlorine tablets eight days later. Tira Southshore also had two transactions of Sh12 million each — a blanket purchase for the “supply of lab reagents for cholera,” and six days later a standard order for the supply of chlorine powder.

Auditors say both the amounts and the timing of such payments are suspicious because blanket agreements should be paid in installments.

“It could well be a duplicate, using the same information, to get through the process. Because you make a blanket [agreement], then the intention is to do duplicates, so that it can pass through the cash payee phase several times without delivering more,” said Ouko upon reviewing some of the transactions for Tira Southshore. This weakness makes the IFMIS system prone to abuse, he added.

In addition, a KSh4 billion contract for hand sanitizer between the Health Ministry’s Preventive and Promotive Health Department and Tira Southshore was approved as a blanket purchase agreement in April 2015. The following month, a standard purchase order was generated for the same amount but without a description of services — this transaction is marked in the system as incomplete. A third transaction — this one for 0 shillings — was generated 10 days later by the same procurement employee, using the original order description: “please supply hand sanitizers 5oomls as per contract Moh/dpphs/dsru/008/14-15-MTC/17/14-15(min.no.6).

Reporters were unable to confirm whether KSh4 billion was paid by the ministry. The leaked data doesn’t include payment disbursement details, and the MOH has not responded to requests for information.

“I can assure you there’s no 4 billion, not even 1 billion. Not even 10 million that I have ever done, that has ever gone through Tira’s account, through that bank account,” said the co-owner of the company, Abigael Mukeli. She insisted that Tira Southshore never had a contract to deliver hand sanitizer, but declined to answer specific questions. It is unclear how a company without a contract would appear as a vendor in IFMIS, alongside contract details.

It is possible that payments could end up in bank accounts other than the ones associated with the supplier. That is because IFMIS also allowed for the creation of duplicate suppliers, according to a 2016 audit of the procurement system. That audit found almost 50 cases of duplication of the same vendor.

“Presence of active duplicate supplier master records increases the possibility of potential duplicate payments, misuse of bank account information, [and] reconciliation issues,” the auditors warned.

They also found such blatant security vulnerabilities as ghost and duplicate login IDs, deactivated requirements for password resets, and remote access for some procurement employees.

Credit: Edin Pasovic/OCCRP

Credit: Edin Pasovic/OCCRP

IFMIS was promoted as a solution for a faster procurement process and more transparent management of public funds. But the way the system was installed and used in Kenya compromised its extolled safeguards, according to auditors.

“There is a human element in the system,” said Ouko. “So if the human element is also not working as expected then the system cannot be perfect.”

The former head of the internal audit unit at the health ministry, Bernard Muchere, confirmed in an interview that IFMIS can be manipulated.

Masking the Setup

Ms Mukeli, the co-owner of Tira Southshore and Ameken Minewest, is the niece of Mrs Nyamai, according to local sources and social media investigation, although she denied the relationship to reporters. According to her LinkedIn profile, Ms Mukeli works at Kenya Medical Supplies Agency, a medical logistics agency under the Ministry of Health, now embroiled in a COVID procurement scandal.

Ms Mukeli’s mother, who is the MP’s elder sister, co-owns Icpher Consultants Company Ltd., which shares a post office box with Tira Southshore and Mematira Holdings Limited, which was opened in 2018, is co-owned by Mrs Nyamai’s husband and daughter, and is currently the majority shareholder of Ameken Minewest. Documents also show that a company called Icpher Consultants was originally registered to the MP, who was listed as the beneficial owner.

Co-owner of Tira Southshore Holdings Limited, Abigael Mukeli, described the company to reporters as a health consulting firm. However Tira Southshore also holds an active exploration license for the industrial mining in a 27-square-kilometer area in Kitui County, including in the restricted South Kitui National Reserve. According to government records, the application for mining limestone in Mutomo sub-county — Nyamai’s hometown — was initiated in 2015 and granted in 2018.

Mukeli is also a minority owner of Ameken Minewest Company Limited, which also holds an active mining license in Mutomo sub-county of Kitui, in an area covering 135.5 square kilometers. Government records show that the application for the mining of limestone, magnesite, and manganese was initiated in 2015 and granted in 2018. Two weeks after the license was granted, Mematira Holdings Limited was incorporated, with Nyamai’s husband and daughter as directors. Today, Mematira Holdings is the majority shareholder of Ameken Minewest, which is now in the process of obtaining another mining license in Kitui County.

According to public documents, Ameken also dabbles in road works and the transport of liquefied petroleum gas. And it’s been named by the Directorate of Criminal Investigations in a fuel fraud scheme.

Yet another company, Wet Blue Proprietors Logistics Ltd., shares a phone number with Tira Southshore and another post office box with Icpher Consultants Company Ltd., according to a Kenya National Highway Authority list of pre-qualified vendors.

Family LinksMrs Nyamai and her husband co-own Wet Blue. The consulting company was opened in 2010, the same year that the lawmaker completed her PhD work in HIV/AIDS education in Denmark.

Wet Blue was licenced in 2014 as a dam contractor and supplier of water, sewerage, irrigation and electromechanical works. It’s also listed by KENHA as a vetted consultant for HIV/AIDS mitigation services, together with Icpher Consultants.

It is unclear why these companies are qualified to deliver all these services simultaneously.

“Shell companies receiving contracts in the public sector in Kenya have enabled corruption, fraud and tax evasion in the country. They are literally special purpose vehicles to conduct ‘heists’ and with no track record to deliver the public goods, works or services procured,” said Sheila Masinde, executive director of Transparency International-Kenya.

Both MOH and Ms Mukeli refused to confirm whether the ordered supplies were delivered.

Mrs Nyamai also co-owns Ameken Petroleum Limited together with Alfred Agoi Masadia and Allan Sila Kithome.

Mr Agoi is an ANC Party MP for Sabatia Constituency in Vihiga County, and was on the same Health Committee as Mrs Nyamai, a Jubilee Party legislator. Mr Sila is a philanthropist who is campaigning for the Kitui County senate seat in the 2022 election.

Juliet Atellah at The Elephant and Finance Uncovered in the UK contributed reporting.

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Speak of Me as I Am: Reflections on Aid and Regime Change in Ethiopia

We can call the kind of intrusive donor clientelism that Cheeseman is recommending Good Governance 2.0. His advocacy for strengthening patron-client relations between western donors and African governments, and his urging that donors use crises as a way of forcing regime change and policy conditionalities, is ahistorical, counterproductive and morally indefensible.

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Speak of Me as I Am: Reflections on Aid and Regime Change in Ethiopia
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In a piece, published on 22 December 2020, that he describes as the most important thing he wrote in 2020, Nick Cheeseman penned a strong criticism of what he calls the ‘model of authoritarian development’ in Africa. This phrase refers specifically to Ethiopia and Rwanda, the only two countries that fit the model, which is otherwise not generalisable to the rest of the continent. His argument, in a nutshell, is that donors have been increasingly enamoured with these two countries because they are seen as producing results. Yet the recent conflict in the Tigray region of Ethiopia shows that this argument needs to be questioned and discarded. He calls for supporting democracy in Africa, which he claims performs better in the long run than authoritarian regimes, especially in light of the conflicts and repression that inevitably emerge under authoritarianism. His argument could also be read as an implicit call for regime change, stoking donors to intensify political conditionalities on these countries before things get even worse.

Cheeseman’s argument rests on a number of misleading empirical assertions which have important implications for the conclusions that he draws. In clarifying these, our point is not to defend authoritarianism. Instead, we hope to inject a measure of interpretative caution and to guard against opportunistically using crises to fan the disciplinary zeal of donors, particularly in a context of increasingly militarised aid regimes that have been associated with disastrous ventures into regime change.

We make two points. First, his story of aid dynamics in Ethiopia is not supported by the data he cites, which instead reflect the rise of economic ‘reform’ programmes pushed by the World Bank and IMF. The country’s current economic difficulties also need to be placed in the context of the systemic financial crisis currently slamming the continent, in which both authoritarian and (nominally) democratic regimes are faring poorly.

Second, we reflect on Cheeseman’s vision of aid as a lever of regime change. Within already stringent economic adjustment programmes, his call for intensifying political conditionalities amounts to a Good Governance Agenda 2.0. It ignores the legacy of the structural adjustment programmes in subverting deliberative governance on the continent during the 1980s and 1990s.

Misleading aid narratives distract from rebranded structural adjustment 

On the first point, Cheeseman establishes his argument early on by stating ‘that international donors have become increasingly willing to fund authoritarian regimes in Africa on the basis that they deliver on development’. In support of this assertion, he cites a table from the World Bank that shows net Official Development Assistance (ODA) received by Ethiopia surging to USD 4.93 billion in 2018, up from just over USD 4 billion in 2016 and 2017, and from a plateau oscillating around USD 3.5 billion from 2008 to 2015.

Cheeseman’s argument rests on a number of misleading empirical assertions which have important implications for the conclusions that he draws. In clarifying these, our point is not to defend authoritarianism. Instead, we hope to inject a measure of interpretative caution and to guard against opportunistically using crises to fan the disciplinary zeal of donors, particularly in a context of increasingly militarised aid regimes that have been associated with disastrous ventures into regime change.

These aggregated data are misleading because ODA received by Ethiopia from western bilateral donors in fact fell in 2018 (and probably continued falling in 2019 and 2020). The World Bank data that he cites are actually from the OECD Development Assistance Committee (DAC) statistics, which refer to all official donors (but not including countries such as China). If we restrict donor assistance to DAC countries – which is relevant given that Cheeseman only refers to the US, the UK and the EU in his piece – disbursed ODA to Ethiopia fell from USD 2.26 billion in 2017 to USD 2.06 billion in 2018 (see the red line in the figure below).

 

Figure: ODA to Ethiopia (millions USD), 2000-2019

Figure: ODA to Ethiopia (millions USD), 2000-2019Source: OECD.stat, last accessed 30 December 2020.

There was a brief moderate increase in DAC country ODA starting in 2015 and peaking in 2017. Cheeseman might have been referring to this. However, contrary to his argument, it was likely that the reason for this increase in aid was primarily humanitarian, responding to the refugee influx from South Sudan that began in 2015 and to the severe drought and famine risk in 2016-17. It was also probably related to attempts to induce incipient political reform following the major protests in Oromia in 2014, which Cheeseman would presumably condone given that conventional measures of democracy and freedom improved in 2018. Indeed, it is notable that committed ODA from DAC donor countries fell even more sharply than disbursed aid in 2018, from USD 2.49 billion in 2017 to USD 2.07 billion, reflecting the context in which these countries were negotiating hard with the Ethiopian government at the time.

Instead, the sharp increase in ODA in 2018 came entirely from the International Development Association (IDA) of the World Bank Group, which increased its mixture of grants and loans to the country from USD 1.1 billion in 2017 to USD 2.1 billion in 2018. This subsequently fell to USD 1.8 billion in 2019 (the dashed green line in the figure).

Such ODA has been explicitly tied to the World Bank’s long-standing goal of liberalising, privatising and deregulating the Ethiopian economy, thereby ‘reforming’ (or disassembling) many of the attributes that have allowed the Ethiopian state to act in a developmentalist manner. These attributes include state-owned enterprises, state control over the financial sector, and relatively closed capital accounts, in strong distinction to most other countries in Africa (including Rwanda).

For instance, in October 2018 it approved USD 1.2 billion from the IDA in support of ‘a range of economic reforms designed to revitalize the economy by expanding the role of the private sector… to gradually open up the economy and introduce competition to and liberalize sectors that have been dominated by key state-owned enterprises (SOEs)’. The support aimed to promote public-private partnerships in key state-owned sectors such as telecoms, power and trade logistics as key mechanisms to restructure these sectors, as well as broader deregulation and financial liberalisation. It is also notable that the World Bank prefaced this justification by emphasising the political reforms that had already been embarked upon, and the promotion of ‘citizen engagement social accountability’ in Ethiopia.

In other words, contra the idea that western donors have been increasing their support for an authoritarian development model, they have been gradually withdrawing aid since 2017. The World Bank pulled up the slack in 2018, and in December 2019 both the World Bank and IMF promised more funding in support of ongoing economic reforms. The economic liberalisation has in turn undermined political liberalisation and has been a key source of political destabilization.

The bargaining hand of these donors has been reinforced by the economic difficulties faced by the Ethiopian economy – in particular, a hard tightening of external foreign-exchange constraints. Balance of payments statistics reveal that the government had effectively stopped external borrowing after 2015, a policy that it was advised to adopt in its Article IV consultations with the IMF in 2016 and 2017 as its external debt distress levels were rising. As a result, the government became excessively reliant on donor grant money as a principal source of foreign financing. Yet the country continued to run deep trade deficits, in large part because its development strategies, as elsewhere in Africa, have been very import and foreign-exchange intensive (e.g. think of the Grand Ethiopian Renaissance Dam, requiring more than USD 4.6 billion to build, the bulk in foreign exchange). Significant capital flight appears to have taken place as well; for example, errors and omissions reported on the balance of payments were -USD 2.14 billion in 2018. In order to keep the ship afloat, the central bank burnt through over USD 1 billion of its reserves in 2018 alone.

Contra the idea that western donors have been increasing their support for an authoritarian development model, they have been gradually withdrawing aid since 2017

This severe tightening of foreign-exchange constraints needs to be understood as a critical structural factor in causing the development strategy to stall. Along with non-economic factors, this in turn put considerable strain on the government’s ability to stabilise political factions through the deployment of scarce resources, of which foreign exchange remains among the most important, especially in the current setting. Again, the point is not to apologise for authoritarianism, but rather to emphasise that the current situation is rooted deeper within a conjuncture of systemic crises that go far beyond any particular form of political administration.

Indeed, Cheeseman commits a similar oversight in ignoring the previous systemic crisis that the present is in many ways repeating. Later in his piece, he asserts: ‘The vast majority of African states were authoritarian in the 1970s and 1980s, and almost all had poor economic growth.’ This is an ahistorical misrepresentation of the profound global crisis that crippled Africa from the late 1970s for about two decades and which was the source of the poor growth he mentions. Then, as now, economic crisis was triggered throughout the continent by the severe tightening of external constraints, which neoliberal structural adjustment programmes exacerbated in a pro-cyclical manner despite being justified in the name of growth. The combination crippled developmentalist strategies across the continent regardless of political variations and despite the fact that many countries were performing quite well before the onset of the crisis. Such historical contextualisation is crucial for a correct assessment of the present.

Along with non-economic factors, this in turn put considerable strain on the government’s ability to stabilise political factions through the deployment of scarce resources, of which foreign exchange remains among the most important, especially in the current setting.

In this respect, there is a danger of putting the cart before the horse. Most countries that descend into deep protracted crises (economic or political) generally stop being nominally democratic, and yet this result becomes attributed as a cause, as if authoritarianism results in crisis or poor performance. Cheeseman cherry-picks two papers (one a working paper) on democracy and development performance in Africa (which like all cross-country regressions, are highly sensitive to model specification and open to interpretation). However, drawing any causality from such studies is problematic given that states tended to become more authoritarian after the global economic crisis and subsequent structural adjustments of the late 1970s and 1980s, not the other way around. For instance, 16 countries were under military rule in 1972, compared with 21 countries in 1989 during the height of adjustment. Faced with crippled capacity under the weight of severe austerity and dwindling legitimacy as living standards collapsed, many states responded to mass protests against the harsh conditionalities of adjustment with increasing force. As such, economic crisis and adjustment plausibly contributed to the rise of political instability and increasingly authoritarian regimes. Other factors include the Cold War destabilisation, which western countries fuelled and profited from. In other words, the political malaise across Africa at the time was driven by as much by external as internal factors.

Aid as a lever of regime change

This leads us to our second point concerning Cheeseman’s vision of aid as a lever of regime change. Cheeseman is at pains to emphasise that rigged elections and repression of opponents have contributed to the recent emergence of conflict in the Tigray region. While these are important features, Ethiopian intellectuals have also emphasised that conflicts in contemporary Ethiopia have taken place against a history of imperial state formation, slavery and debates about the ‘national question’, or what has sometimes been called ‘internal colonialism’. These conflicts are shaped by the system of ethnic federalism, in which ethnically defined states control their own revenues, social provisioning and security forces. They have been affected by foreign agricultural land grabs, which interact with older histories of semi-feudal land dispossession. Most recently, there have been concerns that regional tensions over the Renaissance Dam and agricultural land may help draw neighbouring countries into the conflict.

In the face of this highly complex and rapidly changing context, no one person can identify the optimal response. It plausibly requires regular collective deliberation by people who are deeply embedded in the context. In particular, the brief political liberalisation of 2018 was followed by a sharp uptick of political violence on all sides, rooted in fundamental tensions between different visions of statehood. Such situations cannot be solved simply by ‘adding democracy and stirring’; they require deliberative governance.

Yet, Cheeseman’s piece seeks a reimposition of the very political conditionalities that were a primary factor in subverting deliberative governance on the continent during the first wave of structural adjustment and its attendant Good Governance agendas. Such conditionalities work by constraining the open contestation of ideas and the process of informed consensus-building. They undermine the sovereignty of key institutions of the polity and the economy. And by doing so they degrade the historical meaning of development as a project of reclaiming social and economic sovereignty after colonialism.

Indeed, as Thandika Mkandawire has argued, the previous wave of political conditionalities and democratisation reduced democracies to formal structures of elections and, by wedding and subordinating them to the orthodox economic policy frameworks established under structural adjustment, led to what he called ‘choiceless democracies’. Such ‘disempowered new democracies’ are incapable of responding to the substantive macroeconomic demands of voters and thereby undermining substantive democracy, deliberative governance and policy sovereignty.

In particular, the idea of a democratic developmental state is meaningless in the absence of policy sovereignty. The institutional monocropping and monotasking of the type that Mkandawire wrote about does not merely prevent key institutions, such as central banks, from using broader policy instruments to support the developmental project. It also involves the deliberate creation of unaccountable policy vehicles, such as Monetary Policy Committees (MPCs), which operate outside of democratic oversight, but have considerable hold on the levers of economic policy. MPCs are in turn wedded to neoliberal monetarism. The message to such disempowered new democracies is that ‘you can elect any leader of your choice as long as s/he does not tamper with the economic policy that we choose for you.’ Or as Mkandawire wrote in 1994, ‘two or three IMF experts sitting in a country’s reserve bank have more to say than the national association of economists about the direction of national policy.’

As Thandika Mkandawire has argued, the previous wave of political conditionalities and democratisation reduced democracies to formal structures of elections and, by wedding and subordinating them to the orthodox economic policy frameworks established under structural adjustment, led to what he called ‘choiceless democracies’

In such contexts, the prospect of a democratic developmental state is severely diminished. Ensuring significant improvements in people’s wellbeing is important for the legitimacy of democracies. Yet the subversion of policy sovereignty significantly constrains the ability of new democracies to do so, setting them up for a crisis of legitimacy.

If democracy is to be meaningful it should involve the active engagement of citizens in a system of deliberative governance. Civil society organisations, in this context, are meaningful when they are autonomous institutions of social groupings that actively engage in boisterous debate and public policymaking in articulating the interest of their members. Yet, donor clientelism in Africa has wrought civil society and advocacy organisations that are manufactured and funded by, and accountable to, donors, not the citizens. This is a substantive subversion of democracy as a system of deliberative governance.

In this respect, we can call the kind of intrusive donor clientelism that Cheeseman is recommending Good Governance 2.0. His advocacy for strengthening patron-client relations between western donors and African governments, and his urging that donors use crises as a way of forcing regime change and policy conditionalities, is ahistorical, counterproductive and morally indefensible. In particular, it does not take into account the destructive, anti-democratic role of western-backed regime change and policy conditionality across the Global South during the era of flag independence. Even recently, these donor countries have disastrous human rights records when pushing for regime change in countries such as Afghanistan, Iraq and Libya. Their support for military dictatorships, such as in Egypt, has been a central pillar of foreign policy for decades. And several of these donor countries worked hard to uphold apartheid in South Africa. They have no moral high ground to push for regime change, and little record to ensure that they could do so without causing more harm than good.

Moreover, external actors attempting to enforce their narrow view of democratisation in contexts of deeply polarised and competing visions of statehood, and in the midst of economic instability reinforced by already burdensome economic conditionalities, austerity and reforms, could well be a recipe for disaster. As a collective of intellectuals from across the Horn has emphasised, the people of Ethiopia in particular and the Horn in general must be at the forefront of developing a lasting peace. This would likely require a developmental commitment to supporting state capacity and deliberative governance, not undermining it through external interference and conditionalities.

This article was first published in CODESRIA Bulletin Online, No. 2, January 2021 Page 1

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Mohamed Bouazizi and Tunisia: 10 Years On

Last year marked the 10th anniversary of the death of Mohamed Bouazizi, who on 17 December 2010 set himself alight at Sidi Bouzid in an act of self-immolation that made him the iconic martyr of the Tunisian revolution.

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Mohamed Bouazizi’s name is familiar to all; less so is his background, although the facts of his story are well known and documented. This article will explore the links between the different sequences of ‘protest’ processes in Tunisia, from the 2008 strikes in the minefields, to the most recent (2017-20) El Kamour protests in the country’s south-east. It will also consider the concept of socio-spatial class solidarity, both in turning an individual suicide into the spark for a major uprising, and in facilitating collective resistance and its role in long revolutionary processes.

Two key questions arise: what in Bouazizi’s profile, life and circumstances was of such significance that his suicide sparked a huge popular uprising whose impact, direct and indirect, was felt worldwide. And what can he teach us about the origin, scale and longevity of the Tunisian revolution?

We must therefore examine the suicide of Mohamed Bouazizi within its familial and personal context, but also within the more general context of the political protests against the Ben Ali dictatorship, and especially against the processes of dispossession, impoverishment and exclusion. Sidi Bouzid was clearly a focus of the protests and resistance then spreading throughout Tunisia’s marginalised regions. The prolonged mining strikes of 2008 were a key stage in the actions.

Born into poverty, Mohamed Bouazizi was raised by his mother after he lost his father at the age of three. As the eldest son he grew up with a moral ‘obligation’ to support his mother, to the detriment of his education, and he left school without qualifications. Some time before his dramatic act, he acquired a barrow and scales and started selling vegetables but his informal business attracted endless administrative hassles and police harassment. Finally, on 17 December 2010, the police seized his meagre equipment to put a stop to his trading. Angry, frustrated and desperate, he turned to the only act of resistance that still appeared open to him and thereby unwittingly triggered the countdown to Ben Ali’s fall, scarcely one month later, on 14 January 2011.

‘Individual’ suicide and class solidarity

Between the prolonged mining strike of 2008 and the shows of solidarity unleashed by Bouazizi’s self-immolation, many social movements were active across Tunisia. Among them were the protests made in Sidi Bouzid in June and July 2010 by peasant farmers whose demands focused on a number of issues: access to natural resources such as agricultural land, and water for drinking and irrigation purposes, state aid, and the complex problem of indebtedness.

According to several witnesses interviewed in Sidi Bouzid, as well as two family members, Mohamed Bouazizi took an active part in these demonstrations. Whether or not this is so, I would identify a clear link between the peasant ‘protests’ of summer 2010 and those that followed Bouazizi’s desperate act – a link that explains why this particular case, in contrast to other suicides, sparked a popular uprising across the country. First to take to the streets after Bouazizi’s self-immolation were other peasant farmers’ children identifying with his fatal act of resistance and despair.

Here was a clear example of ‘class solidarity’ among local populations directly affected by the region’s multiple social and economic problems. Over the next few days that same class solidarity also found expression nationwide, moving from the ‘rural’ zones (including ‘rural towns’), to the popular quarters of larger towns, and finally to the big urban centres, including Tunis. The progress of the protests suggests the existence of a distinct class-consciousness embracing all the ‘popular’ classes, rural and urban.

Since the early 1980s, the governorate of Sidi Bouzid has been the site of a rapid, state-initiated intensification of farming, designed to create a modern, export-oriented agricultural hub based on exploiting deep underground water reserves and attracting private and public capital. Over the past four decades Sidi Bouzid has been transformed: from a semi-arid desert fringe with an extensive agriculture based on olives, almonds, pasture and winter cereals, it has become Tunisia’s leading agricultural region, producing over a quarter of the nation’s total output of fruit and vegetables.

But behind this undoubted technical success lies a real social and ecological failure. Socially Sidi Bouzid remains one of Tunisia’s four poorest regions (of 26 in total), while ecologically the level of the water table is plummeting, water for irrigation is increasingly saline, and soil damage is visible, even to non-specialist eyes.

Since the early 1980s, the governorate of Sidi Bouzid has been the site of a rapid, state-initiated intensification of farming, designed to create a modern, export-oriented agricultural hub based on exploiting deep underground water reserves and attracting private and public capital

Here investors – who are mostly outsiders, often called ‘settlers’ by the local population – accrue capital and profits; meanwhile peasant farmers accumulate losses, tragedies and suicides. Without this huge socio-spatial fault, which divides Tunisia between a dominant centre and dependant periphery, Mohamed Bouazizi’s death would scarcely have merited a mention. And that same divide also lies at the heart of several other shocks which will be discussed below.

After the Sidi Bouzid uprising ended with the fall of the Ben Ali dictatorship, several more protest movements arose, all forming part of the same resistance processes in the social and spatial periphery.

The Jemna oasis movement began in 2011 and concerned rights to land and resources, while the El Kamour movement (2017-20) also involves rights to local resources and in particular to ‘development’: two different struggles each of which constitutes a key moment/sequence in the same process of dissent.

At Jemna and El Kamour, as in other cases, the key to mass mobilisation lies in the processes and dynamics of socio-spatial class solidarity: ‘This is where I come from, I belong to this region and this social group, I am being deprived of resources materially and/or symbolically, so I support those who dare to say “no” and resist’. In summary, this is what you can hear in Kebili-Jemna, Tataouine-El Kamour and elsewhere; what you can read in the media reports of declarations made by local populations. And underlying it all, ‘driving’ resistance and ‘cementing’ solidarity, lie profound feelings of injustice and demands for dignity.

Jemna: rights versus law; a disruptive legitimacy

Following the Sidi Bouzid episode and the fall of the dictator, in 2011 an oasis was ‘discovered’ that was probably new to the majority of Tunisians. Situated in the desert, midway between Kebili and Douz, the Jemna oasis owed its sudden appearance on the map to a significant new collective action, stemming directly from specific elements of colonial history that resurfaced after the wall of silence placed around them had been breached.

While most French colonists chose to settle in north or north-west Tunisia and created big cereal farms and/or stock-raising enterprises, and even vineyards and orchards, others preferred to head south and specialise in date farming – in particular the Degla variety, whose export market in France and Europe was virtually guaranteed. Among this latter group was one Maus De Rolley, who in 1937 created a new date-palm plantation around the core of the ancient Jemna oasis. The plantation today covers some 306 hectares, including 185 hectares planted with approximately 10,000 date palms.

Although local populations had held these lands as common and indivisible (tribal) property, they were dispossessed without compensation on the pretext that nomadic herding (pastoralism) was not a genuine productive activity, and that the land therefore was uncultivated. At independence, these populations – who had battled against the occupiers – held great expectations that the new authorities would return their stolen lands.

The Jemna oasis movement began in 2011 and concerned rights to land and resources, while the El Kamour movement (2017-20) also involves rights to local resources and in particular to ‘development’

When the colonial lands were nationalised in 1964, however, the government decided to place them under state control, confiding their management to the body that administered the state’s agricultural land, the Office des Terres Domaniales (OTD), which thereby became Tunisia’s biggest agricultural landowner. Bolstering this strategy was the collectivisation policy of the 1960s, which aimed to reorganise agricultural land and create state ‘socialist’ cooperatives.

Yet the real argument against the redistribution of the nationalised lands lay elsewhere: small peasant farmers were judged too ignorant and archaic, too lacking in the necessary financial and technical means, to develop a modern intensive agricultural sector – a stigmatisation that still recurs today whenever discussion returns to this subject and/or to questions of agricultural models and political choices related to farming and food.

Over the following decades, the heirs made some efforts to reclaim these lands, but it was not until early 2011 that the first organised occupations of OTD lands were launched by local populations describing themselves as the legitimate successors. Among them was Jemna’s local population, who occupied the former De Rolley plantation, claiming rights of property and of exploitation. The authorities demanded an end to the occupation, and the resulting impasse lasted for several years. The government argued that the occupation was illegal, while the occupiers countered that they held a legitimate right to resources and especially to community assets, including the indivisible and inalienable commons.

After a long period of tension a compromise was reached. By mutual agreement, the state ceded full management of the palm plantation to the local population while retaining ownership of the land. Might the latter have believed this negotiated settlement to be the only viable compromise?

Underlying the government position was the fear that any solution implying the grant of freehold to the legitimate heirs might create a legal precedent and set an example that would unleash a torrent of other land claims, all drawing on the same colonial and post-colonial past. But the occupation alone had set that example already, inciting other local populations to reclaim – with some attempts at occupation – the lands snatched from their grandparents during colonisation. Furthermore, I would argue that the Jemna case also served to fuel claims of a legitimate right to other local ‘natural’ resources such as water, minerals (for example, phosphates) and oil that mobilised populations in the Tatouine region.

El Kamour: the ‘will of the people’

Resistance entered another phase, not without success, at El Kamour – a locality situated in the barren steppes of south-eastern Tunisia, south of the town of Tatouine, on the tarmac road leading to the oil-fields in the extreme south of the country. The ‘dispossession pipeline’ carrying crude oil to the port of Skhira, 50 kilometres north of Gabes, runs through here, and this geographical position close to the pipeline is the immediate reason for El Kamour’s sudden appearance on political maps of Tunisia, as well as in the media.

Behind El Kamour, however, lies the governorate and town of Tataouine (Tataouine is the capital of the governorate of the same name), with over 180,000 inhabitants. Arid and barren, this region contains most of Tunisia’s oil reserves, producing 40 per cent of its petrol and 20 per cent of its gas. Yet Tataouine also records some of the nation’s highest levels of poverty: in 2017, for example, 28.7 per cent of its active population were unemployed (compared with a national average of 15.3 per cent), while for graduates the rate rose as high as 58 per cent.

Events in El-Kamour, 2017-2020: a brief chronology

The El Kamour movement began on 25 March 2017, with protests in various localities in the governorate, all converging on the town centre of Tataouine. The protesters were demanding a share of local resources, particularly oil, as well as greater employment opportunities and infrastructure development. Met by silence from the government, on 23 April they organised a sit-in at El Kamour. Tensions mounted on both sides, and an escalation became inevitable after the prime minister visited Tataouine and met the protesters. His plans to calm the situation with a few token promises came to naught and the discussions ended in deadlock. On 20 May the pumping station was occupied for two days before being cleared by the army, and tensions remained high.

Eventually, on 16 June 2017, an agreement was signed with the government through the mediation of the Union générale tunisienne du travail (UGTT), which acted to guarantee its implementation. The terms of the agreement promised the creation of 3,000 new jobs in the environmental sector by 2019, and 1,500 jobs in the oil industry by the end of 2017. A budget of 80 million dinars was also earmarked for regional development. But, to the frustration of the local population, the agreement was never implemented. The government simply bided its time, gambling that the militants would tire and the movement run out of steam.

‘This is where I come from, I belong to this region and this social group, I am being deprived of resources materially and/or symbolically, so I support those who dare to say “no” and resist’. In summary, this is what you can hear in Kebili-Jemna, Tataouine-El Kamour and elsewhere.

On 20 May 2020, however, the El Kamour activists resumed their protests and sit-ins in several places, piling on the pressure and blockading several routes to bar them to oil-industry vehicles. On 3 July they organised a new general strike throughout the public services and the oilfields, and on 16 July they closed the pumping station, blocking the pipelines carrying petroleum products north. But the El Kamour militants had to wait until 7 November 2020 before they could reach an agreement with the government’s representatives, in return for which petrol producers and other oil-sector enterprises were to resume operations immediately.

Signed by the head of government on 8 November 2020, the agreement contains a number of key points, including several that had previously featured in the 2017 accord but had not been implemented. These included, dedicated 80-million-dinar development and investment fund for the governorate of Tataouine; credit finance for 1,000 projects before the end of 2020; 215 jobs created in the oil industry in 2020, plus a further 70 in 2021; 2.6 million dinars for local municipalities and 1.2 million dinars for the Union Sportive de Tataouine.

The big social movements discussed above all have several points in common. Firstly, they are very largely located in southern, central, western and north-western Tunisia, the same marginalised and impoverished regions that between 17 December 2010 and early January 2011 saw huge protests in support of Bouazizi and against current social and economic policies. Secondly, while differing in detail, the principal demands of these movements all relate essentially to the right to resources, services and a decent income. None, or virtually none, are linked to ‘political’ demands (political rights, individual freedom). Thirdly, in their choice of language, and of several ‘spectacular’ actions, these social movements display a radicalism that marks a clear break with the political games played in and around the centres of power. Finally, almost all these movements are denounced and accused of regionalism and tribalism, sometimes even of separatism and treachery. Protesters are suspected of being manipulated, of being puppets in the hands of a political party or foreign power.

Yet these movements have enjoyed some, albeit relative, success – a success impossible without the class solidarity shown in the three examples discussed above, and the ties of domination and dependency that for decades have characterised the relationship between Tunisia’s centre of power (the east coast) and its deprived and impoverished periphery. Finay, these same examples, and other more recent cases, demonstrate that the ‘revolutionary’ processes launched in early 2008 are still active in Tunisia and will probably remain so for many years to come.

This article was first published in The Review of Africa Political Economy journal

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