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Jubinomics and Kenya’s Debt Crisis: A Private Sector View

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Five years ago, the Jubilee administration embarked on a dangerous economic course of deficit financing, profligate spending and punitive taxation. Legitimate government suppliers in the private sector were crowded out in favour of tenderpreneurs and briefcase companies. Mysteriously, government agencies with expanded budgets were unable to pay suppliers. The result today: banks are staring at ballooning non-performing loans, tax revenues have fallen steeply and the private sector is dying a slow, painful death. By P. GITAU GITHONGO.

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Jubinomics and Kenya’s Debt Crisis: A Private Sector View
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The March 9, 2018 handshake between Uhuru Kenyatta and Raila Odinga, silenced many of the critical voices accusing the Jubilee coalition of divisive politics, ethnic bigotry and the disenfranchisement of at least half of Kenya’s population.  In fact, for a brief moment it seemed that the bitter grievances of the disputed August 2017 election, the acrimonious exchanges between political rivals, the threats to the judiciary, the unsolved murder of IEBC’s Chris Msando, and the police killings in the post-election crisis, had been forgotten following the very-closed-door meetings between Uhuru and Raila. As a writer with the Daily Nation gushingly wrote a week later: ‘In the name of that handshake, the shilling has stabilised overnight with the outlook by players in tourism already promising what some experts have christened as the ‘peace dividend’ after an inordinately protracted electioneering period. The stock market is also recovering’. Despite the ceasefire of the handshake, its promised benefits have not cleared the dark clouds hanging over the Kenyan economy, which is now headed into serious difficulties. In fact, at a practical level there appears to be no change in the way the national government runs its day-to-day affairs.

Since coming to power in 2013, the Jubilee administration has been dogged by accusations of profligacy and patronage – most notably in the award of tenders. Policy-making, with senior public officials apparently motivated more by personal interests than by public service, and even outright nepotism and tribalism, spurious contracting in the implementation of policy initiatives in the key sectors of health, agriculture and infrastructure.

Perhaps it is no coincidence that the Jubilee administration has also presided over a massive debt-fuelled increase in annual public spending – KSh 1.2 Trillion to over KSh 2.5 Trillion in 6 years, complemented by a budget deficit approaching Ksh 750 billion (see Table 1). Notably, this growth in spending is at a rate beyond the GDP growth rate and, as far as many critics are concerned, has been partly motivated by the need to accommodate corrupt patronage practices. Spending on infrastructure programmes in particular, seamlessly lends itself to patronage and has been a dominant feature of Jubilee’s tenure, with a range of big-ticket projects in the transport, energy and health sectors. Recurring elements of these projects include secretive feasibility studies, procurement and financing arrangements, as well as questionable labour deployment and land acquisitions – all of which embody the controversial SGR Railway project which has taken up the lion’s share of this spending binge.

Spending on infrastructure programmes in particular, seamlessly lends itself to patronage and has been a dominant feature of Jubilee’s tenure, with a range of big-ticket projects in the transport, energy and health sectors. Recurring elements of these projects include secretive feasibility studies, procurement and financing arrangements, as well as questionable labour deployment and land acquisitions.

Table 1.

Jubilee’s Treasury team however, has maintained that the increase in public spending was and remains necessary to spur economic growth. Treasury has systematically played down the risks from the widening budget deficit in the process. This surge in spending – financed mostly with (Chinese) debt – has also taken centre stage in the cooling relations between the government and development partners, notably the IMF and World Bank. Critical to debate on this spending surge and the risks from a widening budget deficit is its impact on the performance of the Kenyan economy.

In particular, why have key sectors of the economy registered such diminished performance over the past half-decade in the face of this increased spending? Why does so much anecdotal evidence point to growing job-layoffs (an estimated 7,000 formal sector jobs have been lost in the past three years alone)? Even the normally bullish real estate market has shown signs of glut and slowdown over the past three years. The Nairobi Securities Exchange has seen its NSE 20 index climb from slightly over 4,000 in 2013 to a high of 5,400 in 2015, before falling to about 3,400 today. The Stock Exchange, without a single IPO listing since 2014, has seen more than half of all listed companies declare reduced earnings or losses in each of the past two years.

Why have key sectors of the economy registered such diminished performance over the past half-decade in the face of this increased spending? Why does so much anecdotal evidence point to growing job-layoffs (an estimated 7,000 formal sector jobs have been lost in the past three years alone)?

Table 2 below shows Average GDP Growth rates (RHS Scale) over the past 8 years and actual GDP (Using Constant 2009 Prices LHS Scale).

Whereas average GDP growth rates have averaged 5.8 percent over the period shown, the downward trend since 2010 has persisted despite the huge increase in spending – and this is despite GDP-rebasing in 2013 which enhanced the growth rate that year by at least 1%. Both 2013 and 2017 were election years and unsurprisingly, registered the lowest growth rates; but the increased government spending – albeit on long-term projects – appears to have actually had a dampening impact on GDP growth over the period. There are several reasons for this, but three key issues are highlighted here.

1. An unremunerated Private Sector.

Accusations of partisanship and gravy-train policy-making in the award of public tenders and contracts, are not just the grumblings of out-of-favour business-people that lost out on lucrative government business to well-connected or favourably-related individuals. There is a constituency of ordinary hard-working entrepreneurs, professionals and manufacturers increasingly unable to compete against the empowered cartels of tenderpreneurs, influence peddlers and brief-case businessmen. These rogue players currently dominate government contracting – not to mention annual auditor-general reports – making a mockery of procurement guidelines. In some instances they even approach qualified bidders, offering to be embedded in bidding teams (despite the lack of relevant competencies) with a promise of tender success at inflated bids. This patronage-based ‘crowding out’ doesn’t end there. This well-connected class of tenderpreneurs also has perfected the dark art of jumping bureaucratic payment queues, often receiving payments before delivery of goods and services – or even before contracts are signed.

Not by coincidence, legitimate suppliers, service providers, and even farmers, have been experiencing debilitating delays in the settlement of payments and have accumulated massive debts on their credit arrangements and tax obligations. The paradox is that while government department budgets were being ramped up, delays in contract awards and settlement of payments to legitimate suppliers were worsening. This has created a unique set of economic challenges that seems to have been lost in all the discussions on political handshakes.

According to the Central Bank of Kenya, Non-Performing Loans (NPLs) as a proportion of total lending by commercial banks doubled from 6.1 percent in 2015 to 12.4 percent (or about KSh 265 billion) by April 2018 (see Table 3 below). The Table shows Gross Lending by Commercial Banks as well as the stock of Non-Performing Loans, as well as the stock of Non-Performing Loans expressed as a percentage of Gross Lending by Commercial Banks. Even this 12.4 percent figure could be an under-statement if banks have not been adequately disclosing and providing for non-performing loans – as suggested by the sagas of the collapsed Imperial and Chase Banks.

Table 3

CBK Governor Patrick Njoroge attributes a significant factor in this growth in bad loans to delayed payments owed to the private sector by the national government, government departments and devolved units. CBK data suggests that up to KSh 200 Billion was owed to SME businesses by the national government by the end of the 2017/2018 Financial Year, with as much as KSh 25 Billion worth of those pending bills directly contributing to non-performing loans.

Following an increase in imported grains last year (amid accusations of pre-election giveaways), the National Cereals and Produce Board (NCPB) owed farmers as much as KSh 3.5 Billion by the end 2017 for produce already delivered. In a hard-hitting editorial on 7th August 2018, the Daily Nation averred, ‘The Jubilee government is wallowing, not just in foreign debt, but also in the money it owes local businesses, which it has either crippled or is in the process of ruining’.

According to the Central Bank of Kenya, Non-Performing Loans (NPLs) as a proportion of total lending by commercial banks doubled from 6.1 percent in 2015 to 12.4 percent (or about KSh 265 billion) by April 2018. The Table shows Gross Lending by Commercial Banks as well as the stock of Non-Performing Loans, as well as the stock of Non-Performing Loans expressed as a percentage of Gross Lending by Commercial Banks. Even this 12.4 percent figure could be an under-statement if banks have not been adequately disclosing and providing for non-performing loans.

The Daily Nation’s particular beef was that the Government Advertising Agency (GAA), owed media houses close to KSh 3 billion by the end of FY 2017/2018. About half of the KSh 404 Million paid out by GAA during the year, went to the big publishing houses – Nation Media Group, Standard Newspapers, Royal Media Services, The Star and Media Max Network. Against the KSh 3 billion owed, the distribution of payments to media houses was sufficiently skewed to warrant an investigation by the Office of the Public Prosecutor.

Worryingly as well, the increase in bad loans in the banking sector has come despite the implementation of August 2016 of lending rates ‘caps’, which limit the cost of existing loans to 4 percent of the Central Bank’s Recommended Rate. (See Table 4)


2. A Stifled Private Sector

This environment of pending government bills is also linked to worsening Kenya Revenue Authority (KRA) tax collection performance. This creates a vicious cycle in which the private sector is defaulting on its obligations on account of money owed by the same government. The government has long complained about KRA’s inability to meet its collection targets, complaining instead about ‘revenue leakages’ facilitated by corrupt tax officials. But it fails to acknowledge that its pursuit of tax defaulters is a consequence of the fact that they themselves are owed millions by national and county governments.

The reality is that National Government revenue shortfalls have averaged KSh 90 Billion annually over the past 4 years, despite improved tax collection efficiencies at the KRA. (See Tables 5 & 6 below.) The World Bank estimated that in the 2016/2017 financial year, tax revenue as a proportion of GDP fell to under 17%, the lowest in a decade – with the growth in nominal Tax Revenues outpaced by nominal GDP growth.

Table 5

This reduced growth rate of revenue collection by KRA is at first glance paradoxical considering that over the past 5 years, an unprecedented number of Kenyans have been brought into the tax bracket. A similarly unprecedented range of products and services have been subjected to various new direct and indirect taxes. Over the past five years, several tax measures have been introduced including: 12 percent Rental Income tax for landlords from 2015; successive excise duty and fuel levy increases in 2015, 2016 and 2018; VAT on bottled water and juices; VAT on food served by restaurants as well as piped water; successive increases in excise duties on spirts, cigarettes and mobile telephony; and 50 percent Gaming tax on lotteries and book makers in 2017, among  a host of others. The 16 percent VAT on fuels and fuel oils first awarded in 2013 but deferred over the subsequent years with the exemption set to expire on 1st September 2018, adds a controversial element to this expanded tax net aimed at bringing the growth in VAT collections closer to that of direct taxes such as PAYE and Income Taxes (see Table 6).

Table 6

In his June 2018 Budget statement, Finance CS, Henry Rotich, laid out several new and controversial ‘Robin Hood Tax’ proposals which he declared necessary to fund programmes that are part of Jubilee’s ‘Big 4’ agenda. Prominent among the proposals purportedly designed to protect low-income earners, is a monthly contribution to a nebulous National Housing Development Fund by every employee and employer of 0.5% (capped at KSh 5,000) of the employee’s gross pay. This contribution would be funnelled to the Housing Fund whose mandate will be to build low-cost housing units. Another ‘Robin Hood Tax’ proposal was the levying of 0.05% excise duty on all remittances of KSh 500,000 or more, transferred through banks and other financial institutions; as well as an increase in the excise duty charged on money transfer services by mobile phone providers from 10 percent to 12 percent, all geared to financing Universal Health Care – another Big 4 pillar.

Several of these proposals have been rightly criticised as being unjust and inordinately detrimental to low-income earners. With more than a third of all Kenyans living on less than Ksh 100 per day, a projected VAT-inclusive paraffin price of KSh 105 per litre is simply unreasonable. The curb on logging has already raised the cost of the popular-sized sack of Charcoal to more than Ksh 3,000 in parts of Nairobi, with the 4-kg tin costing more than KSh 150. With electricity prices also being ramped up as the monopoly power distributor Kenya Power struggles to maintain solvency following years of mismanagement, low and middle income earners are clearly big losers. The situation is no better for businesses, notably manufacturers and other high energy consumers. Early this month, the Kenya Association of Manufacturers registered strong objections to the revised energy tariffs which entailed a 36 percent increase in the energy base-cost – before the envisaged 16 percent VAT increase – which KAM argued would have a detrimental effect on the cost of doing business in the country.

With more than a third of all Kenyans living on less than Ksh 100 per day, a projected VAT-inclusive paraffin price of KSh 105 per litre is simply unreasonable. The curb on logging has already raised the cost of the popular-sized sack of Charcoal to more than Ksh 3,000 in parts of Nairobi, with the 4-kg tin costing more than KSh 150. With electricity prices also being ramped up as the monopoly power distributor Kenya Power struggles to maintain solvency following years of mismanagement, low and middle income earners are clearly big losers.

A recurring complaint from the private sector over the past half-decade has consistently been that consumer purchasing power has contracted considerably and that this is being exacerbated by recent and proposed tax measures. The decline in tax revenues despite the increases in tax rates, tax measures and collection efficiencies by KRA (notably year-on-year growth in taxpayers registered on KRA’s I-Tax platform), all but confirms a sharp drop in formal economic activity over the period.

Arthur Laffer who was an adviser to the Nixon/Ford Administration in the mid-1970’s mainstreamed the simple mathematical tautology that there is a point beyond which any increases in tax rates will always result in declining tax revenues. Laffer’s analysis of the US economy at the time recommended a decrease in federal tax rates to boost tax revenues. Rotich’s proposed tax measures risk the same results by further dampening of economic activity as well as greater tax evasion.

3. A Crowded-out Private Sector

The aforementioned slump in tax revenue growth was also partially influenced by the slowdown in bank profitability – which in turn was due to the twin influences of growing bad loans and reduced access to credit by the private sector. These factors are inexorably linked to diminished private sector performance. However, reduced access to credit by the private sector in Kenya is not a new phenomenon; nor are its fundamental causes. Its disruptive influences however, are significant.   Commercial credit to the private sector has contracted from about 24 percent in 2013 to 18 percent by end of December 2015, to about 2.5 percent in June 2018. This is despite the implementation of interest caps in August 2016, disabusing the suggestion that enhanced credit to the private sector was the intended beneficiary of the interest rate caps. In contrast, during the same period annual growth in lending to government averaged 14%.

Table 7

The Banking Amendment Act 2016 proposed by MP Jude Njomo was signed into law by President Uhuru Kenyatta with the same hollow promise of cheaper and more private sector lending by banks that a similar bill by then MP Joe Donde had made in the year 2000. The backgrounds shared notable similarities however – most notably heavy government borrowing. Domestic borrowing was indeed high in the late 1990s – evidenced by the 91-day Treasury Bill on offer with a 21% return in June 1999. By 2000, domestic borrowing was attracting Ksh 22 Billion in annual interest payments.  The stock of domestic debt by June 2000 stood at KSh 164 Billion with new issues representing 17.5 percent of government revenue. By June 2007, with short term Treasury Bill rates down to less than 8 percent, the stock of domestic debt had only risen modestly to KSh 405 Billion representing 22.1 percent of GDP, and attracting interest payments of KSh 37 Billion in FY 2006/2007. By March 2016 however, the stock of domestic debt had jumped to KSh 1.65 Trillion representing close to 27 percent of GDP and was attracting a massive 30 percent of total government revenue in debt service. And that’s not even taking into account external debt which had grown at a similar rate. The stock of domestic debt in March 2018 had reached KSh 2.3 Trillion, attracting more than KSh 350 Billion in annual debt payments.

Arthur Laffer who was an adviser to the Nixon/Ford Administration in the mid-1970’s mainstreamed the simple mathematical tautology that there is a point beyond which any increases in tax rates will always result in declining tax revenues…Rotich’s proposed tax measures risk the same results by further dampening of economic activity as well as greater tax evasion.

In August 2000, Commercial bank lending rates averaged close to 21 percent and deposit rates about 7 percent, providing obvious justification for the Njomo Bill’s popular support. The stock of non-performing loans (NPLs) at the time, was an eye-popping KSh 122 Billion in April 2001, (40 percent of total lending). In June 2018 and despite interest rate caps in place, NPLs represent 12.4 percent of commercial lending with an estimated Ksh 303 Billion in this category.

Table 8

The Parlous state of Kenya’s national accounts – most notably the KSh 5 Trillion stock of public debt and ballooning budget deficit – but also poor performance of the real economy with stagnant exports and tax revenues, suggests that the government cannot afford to be adding to the burden borne by the private sector. It also suggests that the slew of tax measures proposed in Budget 2018 was purely about desperately seeking to finance reckless government spending and not about providing incentives for private sector economic growth. Critically, it also confirms that the interest caps were always really about government access to cheaper domestic borrowing and not about promoting private sector economic activity, which the government appears to be doing its best to stifle.

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Gitau Githongo is a financial consultant based in Nairobi.

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Tigray is Africa’s Ukraine: We Must Build Pan-African Solidarity

A genocide is taking place in Tigray. Why is there no mobilization of African civil society organizations, non-governmental bodies, religious institutions, and individuals in support of Tigrayan refugees?

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Tigray is Africa’s Ukraine: We Must Build Pan-African Solidarity
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Two months after the Russian invasion of Ukraine, more than  5 million Ukrainians fleeing the war have crossed the borders into other European countries. While this is largely a testament to the massive scale of the attack by Russian forces that has forced millions of Ukrainians to flee their homes in all directions, it also has a lot to do with the warm welcome and sympathy extended to these refugees by European nations.

Europeans both individually and collectively stood in solidarity with and committed to supporting Ukrainian refugees in all ways. Member states of the European Union established reception centres and facilitated the right to travel, stay, and work for all Ukrainians within days of the war starting. Families across Europe (and in the United Kingdom) volunteered to host Ukrainian families, organizations raised funds, individuals donated basic necessities, and many even travelled to borders to personally welcome Ukrainian refugees.

While this “gold standard” welcome by European countries—who are generally accused of being hostile to other (particularly black and brown) refugees—has been the subject of heated discussion, a question that is yet to be thoroughly addressed is why such solidarity is not seen in other parts of the world. More particularly, using the experiences of refugees from the Tigray war as a case study, we would like to ask why the multiple conflicts ravaging the African continent fail to inspire such a response by African countries.

The Tigray war, characterized as the world’s deadliest war, has been ongoing for seventeen months. Thus far, more than 500,000 people are reported to have died. Terrible atrocities amounting to war crimes and crimes against humanity, including scores of massacres, weaponized sexual violence, and a total humanitarian blockade have all contributed to creating conditions aptly described by the Director-General of the World Health Organization (WHO) as “hell”.  Despite the length and brutality of this conflict, however, the number of Tigrayans who have managed to escape into neighbouring African countries is relatively minuscule.

As far as we are able to establish, about 70,000 Tigrayans crossed into Sudan during the first few days of the war. We can add to these the thousands of Tigrayans who worked and lived in Djibouti before the war and the few hundreds that managed to flee to Kenya following the ethnic profiling and mass arrests they faced in Ethiopia. It is possible to argue that the number of refugees from Tigray has remained low mainly because the borders have been blocked by the Ethiopian regime and its allies. This draconian blockade has indeed been used as a tool of war by Prime Minister Abiy Ahmed to completely cut off Tigray from the rest of the world in order to hide atrocities and control the narrative. It is also believed to have the approval of key members of the international community seeking to mitigate the impact of the war on the broader Horn of Africa region and its potential contribution to the migration crisis in Europe.

Even so, taking into account the precarious situation of the millions of Tigrayans in the region itself and in the rest of Ethiopia along with well-known patterns of illicit migration from conflict areas, it is reasonable to wonder if the low number of Tigrayan refugees is due to the receptiveness—or lack thereof—of neighbouring countries as well as the blockade. With this in mind let’s look more closely at some policies and practices in the region that can be perceived as obvious deterrents to those seeking refuge.

Political and diplomatic support given by African countries to the regime in Addis Ababa 

The Tigray war is happening in the host country of the African Union (AU) and the second-most populous country on the continent. However, this conflict has not been included as an agenda item in any of the meetings of the AU heads of states that have been convened since its onset in November 2020. The only significant statement that was made regarding this conflict by the Chairperson of the AU, Moussa Faki Mahamat, was one that endorsed the war. Since this early statement, the AU has assiduously ignored the overwhelming evidence of the gruesome atrocities and violations of human rights and humanitarian laws perpetrated during this conflict. Nor has the AU acknowledged the direct involvement of Eritrea and Somalia—both members of the AU—who deployed troops into Tigray and have been credibly accused of committing grave atrocities.

Diplomatically, African countries have given cover to the Ethiopian regime in all multilateral forums including the United Nations Security Council (UNSC). The passionate and well-received speech by Kenya’s ambassador to the UN, Martin Kimani, in opposition to Russia’s war of aggression against Ukraine, makes one wonder why the same passion is absent for crises nearer home, including Tigray. Sadly, however, not only do the so-called A3 countries on the UNSC continue to frustrate action against the Ethiopian regime, African countries have voted against measures to establish investigative mechanisms into the atrocities committed in Tigray. Even more disappointingly, on the 31st of March, Kenya voted in support of a bill introduced by the Ethiopian regime to halt funding for the International Commission of Human Rights Experts set up to investigate the crimes and human rights abuses that took place in Tigray.

The AU has assiduously ignored the overwhelming evidence of the gruesome atrocities and violations of human rights and humanitarian laws perpetrated during this conflict.

These actions indicate that the AU and its member states have either failed to recognize the gravity of the human rights and humanitarian violations in Tigray or are unwilling to address violations by other member states, however grave, as a matter of policy.

Forced Repatriation to Ethiopia

This policy and the attendant practices in turn mean that Tigrayans or other minorities seeking refuge from state-sanctioned violence in the region are denied official welcome and feel insecure even when they are sheltered there as refugees under UN protection. Tigrayan refugees in the region are under continuous threat from Ethiopian and Eritrean intelligence and security officials that are fully capable of crossing borders to harm or forcibly repatriate them. Just to look a bit more closely at the experience of Tigrayan refugees in the region, in Sudan, senior Ethiopian officials and supporters of the regime have on several occasions threatened to forcefully repatriate Tigrayan refugees from the Sudanese refugee camps that are under the auspices of the United Nations High Commissioner for Refugees (UNHCR).

In Djibouti, the threat of forced repatriation was realized when several Tigrayans, who had committed no known crime, were apprehended and returned to Ethiopia. This clear breach of the principle of non-refoulement has excited no response from other African governments or African Civil Society Organizations (CSOs). 

Tigrayans also live in fear of forced repatriation even in the relatively more friendly Kenya. The December 2021 abduction of Tigrayan businessman Samson Teklemichael in Nairobi in broad daylight is a prominent example of the insecurity of Tigrayan refugees in Kenya. In addition, personal accounts from Kenya suggest that newly arriving refugees can fall victim to immoral actors demanding large sums of money to facilitate registration. Tigrayans who have been unable to obtain proper documentation for this and other reasons risk being thrown in jail. The lucky few that are registered are coerced to relocate to remote and inhospitable camps. As a result of this, and due to the increased insecurity created by the presence of Ethiopian and Eritrean intelligence officers operating in Nairobi, Tigrayans in Kenya are increasingly opting to remain hidden. This means that the actual number of Tigrayan refugees in Kenya is unknown.

The December 2021 abduction of Tigrayan businessman Samson Teklemichael in Nairobi in broad daylight is a prominent example of the insecurity of Tigrayan refugees in Kenya.

It also bears noting that in response to the war in Tigray, the Kenyan government tightened its borders with Ethiopia, essentially closing the only avenue open for Tigrayans fleeing conflict and ethnic-based persecution by land. Moreover, Tigrayan refugees who have been stopped at Kenyan border controls in Moyale have at different times been apprehended and returned by agents of the Ethiopian regime.

Harsh conditions facing Tigrayan refugees

Sudan hosts the largest number of documented Tigrayan refugees. An estimated 70,000 Tigrayans fled to Sudan to escape the brutal invasion and occupation of Western Tigray. While these people were welcomed with extraordinary kindness by the people of Eastern Sudan, the refugee camps to which they were relegated are located in remote and inhospitable regions with almost no basic infrastructure. As a result, international organizations have been unable to provide adequate support and Tigrayan refugees have fallen victim to extreme weather and fires.

Similarly, Tigrayans remaining in Djibouti are kept in remote camps under unbearable conditions, facing maltreatment and abuses such as rape and sexual violence including by security forces. The whereabouts of the thousands of refugees who escaped from abuses and starvation at Holhol, one of Djibouti’s remote refugee camps where over 1,000 Tigrayans remain, are unknown.

The disinterest of African media and society

Arguably, the above realities describe the failings of African governments in terms of welcoming and protecting refugees fleeing conflict. But what of other sections of African society? Why are there no responses akin to the mobilization of European civil society organizations, non-governmental bodies, religious institutions, and individuals to support Ukrainian refugees? Even taking into full account economic limitations likely to affect responses to such crises, this could potentially speak to a larger failure in terms of building pan-African solidarity, not just as a political concept but as a grassroots reality. In the specific case of the Tigray war, this is further reflected and augmented by the minimal coverage of the war in African media outlets relative, for example, to the extensive daily coverage given to the Ukraine war. Moreover, African intellectuals and intercontinental forums have shown little to no interest to address an ongoing genocide that is quickly paralleling the worst examples of mass atrocities on the continent thus far.

What can we learn from the European Response to the Ukraine crisis?

In many ways, the European response to the Ukraine crisis has been unprecedented and arguably sets a new standard for welcoming refugees from all regions including Europe itself. In the African context, the Tigrayan experience of policies and practices that endanger and harm the most vulnerable seeking safety reveals an urgent need to take these lessons on board.  With this in mind, we can tentatively outline the following suggestions.

First, we as Africans should find mechanisms for building pan-African solidarity amongst citizens that are not contingent upon the will of our governments. This can only be achieved if African media, civil society organisations, thought leaders, and other influencers commit to prioritizing what is happening on the continent. In this interconnected and highly digital age, it is no longer acceptable that an African anywhere on the continent does not know about what is happening in Tigray as much as, or more than, they know about what is occurring in Ukraine.

We as Africans should find mechanisms of building pan-African solidarity amongst citizens that are not contingent upon the will of our governments.

Second, African citizens should protest policies and practices by African governments that favour state-sanctioned violence and support regimes over vulnerable communities. We all, as Africans, are prone to fall victim to state violence and violations of human rights in our countries and this necessitates pan-African reflection on human rights for all, indigenous communities as well as refugees and migrants.

Third, refugees and migrants are rarely a burden on the host countries and communities. Those fleeing the Tigray war, for example, are generally highly educated and carry unique skills that could contribute to societies wherever they land. Harnessing these resources on the continent should be a priority. Moreover, refugees enrich host communities and facilitate regional and continental integration which the AU and its member states continue to discuss, but never materialize.

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UK-Rwanda Refugee Deal: A Stain on President Kagame

Rwanda’s proposed refugee deal with Britain is another strike against President Paul Kagame’s claim that he is an authentic and fearless pan-Africanist who advocates for the less fortunate.

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UK-Rwanda Refugee Deal: A Stain on President Kagame
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In mid-April 2022, Rwanda and Britain unveiled a pilot scheme in which the latter will ship off asylum seekers who arrive in Britain “illegally” to the former for the whopping sum of £120 million. Although full details of the deal remain sketchy, it is believed that it will target mainly young male refugees who apply for political asylum in Britain. Anyone who entered the UK illegally since January 1, 2022, is liable to be transferred. Each migrant sent to Rwanda is expected to cost British taxpayers between £20,000 to £30,000. This will cover accommodation before departure, a seat on a chartered plane and their first three months of accommodation in Rwanda. Their asylum application will be processed in Rwanda and if they are successful, they will have the right to remain in Rwanda. Those whose applications fail will be deported from Rwanda to countries where they have a right to live. The plan is contingent on the passage of the Nationality and Borders Bill currently before the British Parliament. Britain is planning to send the first set of asylum seekers in May 2022, but this is highly unlikely as human rights groups will almost likely challenge this deal in court and, as a result, delay the implementation.

Rwanda’s Foreign Minister, Vincent Biruta, and Britain’s Home Secretary, Priti Patel, present the initiative as a remedy to what they deem a malfunctioning refugee and asylum system, “(T)he global asylum system is broken. Around the world, it is collapsing under the strain of real humanitarian crises, and because people traffickers exploit the current system for their own gain… This can’t go on. We need innovative solutions to put a stop to this deadly trade.” In a jointly written editorial for the UK’s Times newspaper, they portray the agreement as a humanitarian measure that would disrupt the business model of organized criminal gangs and deter migrants from putting their lives at risk.

Back in Rwanda, the pro-Kagame newspaper, The New Times of Rwanda, highlighted Rwanda’s experience in hosting refugees: “Rwanda is home to nearly 130,000 refugees from around the region.” The New Times claims that “… even those who arrived in Rwanda as refugees fleeing violence have since been integrated in the community and enjoy access to education, healthcare and financial services. This friendly policy toward refugees and migrants is in part linked to the country’s history.” It concludes by noting that “Kigali’s decision to extend a helping hand to migrants and asylum seekers in the UK who’re unable to secure residence there is very much in keeping with this longstanding policy on migrants and moral obligation to provide protection to anyone in need of safety. It is, therefore, shocking that this act of generosity has come under severe attack by some people, including sections of the media.”

Reaction in the UK has been mostly negative, ranging from the Anglican ChurchAmnesty International. A broad range of 150 organizations, including Liberty and the Refugee Council, sent an open letter to Prime Minister Boris Johnson and his Home Secretary (the UK immigration minister).  Even some MPs from Johnson’s ruling Conservative party condemned the deal. Dozens of Home Office staff have criticized the policy and are threatening to strike because of it.

Deals of this kind between Britain and Rwanda are not new. Britain tried to enter a similar agreement with Ghana and Kenya, but both rejected it, fearing a backlash from citizens. Rwanda has done similar deals before. Israel offshored several thousands of asylum-seekers, many of them Eritreans and Sudanese, to Rwanda and Uganda between 2014 and 2017. A public outcry forced Israel to abandon the scheme when evidence emerged that most of them ended up in the hands of people smugglers and were subjected to slavery when traveling back to Europe. Under a deal funded by the European Union, Rwanda has taken in evacuees from Libya. Denmark has a similar agreement with Rwanda, but it has not yet been implemented.

In 2016, Australia signed a similar deal with Nauru, a tiny island country northeast of Australia. In May 2016, Australia held 1,193 people on Nauru at the cost of $45,347 a month per person – about $1,460 a day or $534,000 a year. That same year, the EU signed a deal with Turkey under which Turkey agreed to take back “irregular migrants,” mainly from Syria, Afghanistan, Iraq, in exchange for reduced visa restrictions for Turkish citizens, €6 billion in aid to Turkey, update the EU’s customs union with Turkey, and re-energize stalled talks regarding Turkey’s accession to the European Union.

If these failed deals did not deter Britain, Rwanda’s human rights record should have. Even Kagame’s supporters concede that his human rights record is deplorable. At the 37th session of the Universal Periodic Review (a regular, formal review of the human rights records of all 193 UN Member States), Britain recommended that Rwanda “conduct transparent, credible and independent investigations into allegations of extrajudicial killings, enforced disappearances and torture, and bring perpetrators to justice.” A Rwandan refugee in London told The Guardian that, “Rwanda is a good country for image, but not for freedom of speech…Those who oppose Kagame end up in prison. The Rwandan government use[s] torture and violence against their opponents.”

The deal between Rwanda and Britain also contravenes international law. The principle of non-refoulement “… prohibits States from transferring or removing individuals from their jurisdiction or effective control when there are substantial grounds for believing that the person would be at risk of irreparable harm upon return, including persecution, torture, ill-treatment or other serious human rights violations.” The United Nations High Commissioner for Refugees (UNHCR) notes that Britain has a duty under international law to ensure that those seeking asylum are protected. UNHCR remains firmly opposed to arrangements that seek to transfer refugees and asylum seekers to third countries in the absence of sufficient safeguards and standards. Such arrangements simply shift asylum responsibilities, evade international obligations, and are contrary to the letter and spirit of the Refugee Convention . . . [P]eople fleeing war, conflict and persecution deserve compassion and empathy. They should not be traded like commodities and transferred abroad for processing.

Rwanda is the single most densely populated state in Africa, with more than 1,000 people per square mile. It already has its fair share of refugees from neighboring countries. (Biruta told the Financial Times last month: “This program [the deal with Britain] will be dedicated to asylum seekers who are already in the UK … we’d prefer not to receive people from neighboring countries, immediate neighbors like DRC, like Burundi, Uganda or Tanzania.”

Although it has done well economically compared to many other African countries, it remains a poor nation that needs to prioritize addressing its internal economic issues rather than allowing Britain to dump its refugees on them. It is unlikely that the economic benefits of this deal will help get the average Rwandan out of poverty. If Rwanda needs more refugees, it needs to look no further than its neighbors. Many of those who will end up in Rwanda will likely be genuine refugees who would have a right to remain in Britain and white supremacists in the UK do not want them there because they do not have the right skin color.

With this deal, Johnson and Patel are pandering to the racists simply to get more votes. If this deal was in place in 1972, when Idi Amin deported Ugandans of Asian descent to the UK, Patel’s family might likely have been shipped off to Rwanda. For his part, Kagame is pandering for influence and money from Western nations. It undermines his claim that he is an authentic and fearless pan-Africanist who advocates for the less fortunate. What happened to speaking the truth to Western powers? Let us hope a judge in the UK stops this terrible deal.

This post is from a partnership between Africa Is a Country and The Elephant. We will be publishing a series of posts from their site once a week.

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Road to 9/8: What Is at Stake?

This is the first of a series of articles that will discuss some of the major issues at stake, and the roles played by various institutions in safeguarding the integrity of the August 2022 general election.

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Road to 9/8: What Is at Stake?
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The past few months have witnessed political activity that is reaching fever pitch ahead of the general elections which are slated for August 9th. Public officers intending to contest in the forthcoming elections have resigned from office and political parties have either held party primaries or issued direct nominations. Already, parties have shared with the Independent Electoral and Boundaries Commission (IEBC) the final list of candidates they intend to field for the elections, and campaigns officially begin by the end of May.

In reality, the campaigns commenced years ago; immediately following the 2017 general election when the president and the leader of the opposition made amends and embarked on the constitutional reform process that was the Building Bridges Initiative (BBI), the drumbeat of electioneering became ubiquitous. Since then, the political class has largely been in a preparatory mood, with various outfits coming together in anticipation of forming the next government. Despite the attempted BBI constitutional reform being halted by successive courts including the Supreme Court, the effect it has had on political campaigning has persisted, with broad coalitions being formed in apparent anticipation of power-sharing arrangements akin to those proposed under the BBI Bill.

Based on recent developments, the forthcoming elections are shaping up to be highly unprecedented and unique. This is primarily due to the make-up of the competing factions. In an unsurprising but also unprecedented turn of events, the incumbent has thrown his weight behind the opposition leader against his own deputy. The last time we saw this in Africa was in Malawi when Salous Chilima (current and immediate former vice-president of Malawi), was in direct confrontation with President Peter Mutharika.

Evidence suggests that the president intends to remain in active politics beyond his term. For example, he recently revitalised his Jubilee Party, now a member of the Azimio-One Kenya Alliance Coalition that will be fielding Raila Odinga as its presidential candidate. Further, he was appointed Chairperson of the Council of the Azimio-OKA Coalition. More recently, the Cabinet Secretary for Finance omitted allocations for the president’s retirement in his budget statement apparently out of caution to avoid violating the legal restrictions on retirees enjoying perks while involved in active party politics. “Walking into the sunset” does not seem to be on the president’s agenda.

The president’s involvement complicates attempts to forecast the outcome of the elections. For one, it is presumed that the incumbency advantage will operate in favour of the opposition leader with the president’s backing. Already, Raila Odinga has stated he intends to “walk in Uhuru’s footsteps” to benefit from the president’s achievements and inherit his support base. Unfortunately, this puts him in the difficult position of being unable to wholly distance himself from the blemishes in the president’s record. It also undermines one of Odinga’s hallmarks: being an anti-establishment figure. In addition, one need only recall—especially now following the death of President Mwai Kibaki—that the power of President Daniel arap Moi’s incumbency was in fact a poisoned chalice for candidate Uhuru Kenyatta, who was crushed at the polls, wining just 31 per cent of the vote compared to Mwai Kibaki’s 62 per cent.  Some claim that Raila Odinga was the “king maker” since he backed President Kibaki. There may be some truth to this, but it is also true that Raila Odinga made a political and not an altruistic decision: he read the mood of the country and surmised that he had to distance himself from the establishment that President Moi and then candidate Uhuru Kenyatta represented. So, in a sense, Deputy President William Ruto is today’s Mwai Kibaki, President Kenyatta is today’s Moi and, irony of all ironies, Raila Odinga is today’s candidate Uhuru Kenyatta. Don’t ever be told that musical chairs is a children’s game.

The president’s involvement also raises questions around the use of state machinery to boost Odinga’s candidacy. A supplementary budget estimate tabled in parliament saw an increase in the president’s budgetary allocation for new vehicles from KSh10 million to KSh300 million. In a campaign season where the president has made clear his level of involvement, it is clear that, with the assistance of the National Treasury, the president has elided the lines between state and political candidate.

In a sense, Deputy President William Ruto is today’s Mwai Kibaki, President Kenyatta is today’s Moi and, irony of all ironies, Raila Odinga is today’s candidate Uhuru Kenyatta.

On the other hand, the deputy president is walking an intellectual tight-rope, taking credit for the achievements of the last 10 years and distancing himself from the blemishes. This is an altogether self-serving strategy but, were it not for the resonance of the “hustler” narrative, one would have thought that its transparent hypocrisy would be its own condemnation.

Bearing in mind Kenya’s unique history with election-related fraud, there exists a tangible risk of either side engaging in fraud, but this is more plausible where the state has a vested interest (such as the president’s). While speaking in the US, the deputy president stated that Kenya’s democracy is under threat and further alluded to a plot by several political actors to manipulate the outcome of the election. In his research, Walter Mebane has shown that fraud was prevalent in both the 2013 and 2017 general elections. The vice president was a beneficiary of both results. It is always hard to speak from both sides of your mouth; except if you are a politician, it seems. Without commenting on the accuracy of the deputy president’s assertions, it is clear that the IEBC, election observers, civil society and the judiciary will have to remain vigilant for any signs of fraud. Already, the deputy president’s party—the United Democratic Alliance—has faced allegations of rigging following its recently concluded primaries.

Further context

Perhaps the biggest contributor to the highly consequential nature of this election is the context in which it is taking place. Last year, the president and the leader of the opposition attempted to orchestrate a constitutional reform process that was finally halted by the Supreme Court. Seemingly motivated by a desire to remedy the winner-takes-all nature of elections to which they attribute the violence that always accompanies electoral processes, the president and the opposition leader proposed to expand the executive and to make a raft of other changes to the constitution through the BBI. In contortions only possible when the pursuit of power is the organising principle for decision making rather than any sense of principle, both the president and Odinga were supporters of the constitution but led the BBI movement which would have dismembered that constitution. Deputy President Ruto was a virulent critic of the constitution but has portrayed himself as its chief defender with his opposition to the BBI.  Like Saint Paul, both camps seem to have experienced a moment of conversion, but it is unclear who is on the road to Damascus. To a section of Kenyans, this entire process was an affront to the spirit of the constitution and constituted an elite power-sharing scheme. Some even viewed it as an attempt by the president to stage-manage his succession. As noted, whilst the BBI was overturned by the courts, the broader political aims sought by its promoters are currently being pursued.

The high stakes nature of the election is not lost on the various political factions in formation. Already, parallels are being drawn between the upcoming election and the 2002 general election, which is widely believed to be one of the more credible elections in Kenya’s history. This is in part due to the broad range of support Raila Odinga has been receiving from political actors who were involved in the 2002 NARC Grand Coalition. However, such a comparison immediately fails as John Githongo rightly explains: the upcoming elections seem to be about nothing. This is despite attempts by both sides to centre economic reform in campaign discourse. Without a clear impetus to go to the polls, voter apathy is high.

Whilst the BBI was overturned by the courts, the broader political aims sought by its promoters are currently being pursued.

Kenya is in the middle of a biting economic crisis. As of June 2021, the country’s public debt stood at KSh7.7 trillion—a 300 per cent increase in the country’s debt stock from 2013. As it stands, a significant portion of the country’s revenue is used to service debt. According to the Institute of Economic Affairs, the debt service to tax revenue ratio is currently 49 per cent—a 19 per cent increase from 2013/14. These trends seem to have brought the economic agendas of the various candidates into sharper focus. For example, the deputy president has proposed a “bottom up” economic model that pits “hustlers” against “dynasties”. On the other hand, his opponent has floated the idea of a social welfare programme involving the distribution of a monthly stipend to certain sectors of the population. These economic agendas seem not to have taken root, with significant political commentary focusing on tribal demographics and the candidates’ support bases in various regions. This is a concerning reality as the next administration will be saddled with the enormous burden of economic recovery.  And while the politicians politic, northern Kenya is the grip of a growing famine.

Aside from the state of the economy, these elections come against a backdrop of declining relations between the executive and the judiciary. In recent years, the country has witnessed the flouting of court orders, the interference with the independence of the judiciary, a worrying increase in the rate and normalisation of corruption, and the use of criminal law enforcement agencies for the settlement of commercial disputes.  While the courts have in many ways held the executive to account and stood firmly on the side of constitutional order, in the context of commercial and criminal law, the courts are riven with corruption and this has badly dented the judiciary’s credibility. Besides reducing investor confidence and jeopardising the state of the economy, these trends threaten people’s fundamental rights and freedoms. The further they are entrenched, the less likely we as a country are able to backtrack and rebuild.

Risks 

The upcoming elections are likely to be highly polarising. Election related violence stemming from political division is not new to Kenya; thus far, both sides’ party primaries have been rocked by violence. In what is an unfortunately ironic turn of events, the attempt by the president and Raila Odinga to remedy the “winner-take-all” nature of elections to which they ascribe election-related violence, seems to have had the opposite effect. The broad nature of the coalitions forming only serves to raise the stakes, increasing the likelihood of tensions running high. Take for example the political primaries: the positioning of the two coalitions within their strongholds is such that candidates needed to secure a ticket to maintain a chance at winning in the elections. As a result, some have turned to unscrupulous tactics to do so, and faced with unfavourable outcomes, have resorted to violence.

The broad nature of the coalitions forming only serves to raise the stakes, increasing the likelihood of tensions running high.

The increased digitisation of political campaigning continues to muddy the waters. This election cycle has seen a significant amount of mis- and disinformation. Some of the content tends towards spreading inciteful messages. However, social media platforms have largely remained complacent, jeopardising Kenyans’ access to civic information online, and undermining healthy democratic debate.

Between Kenya’s election history which is fraught with division and violence, and the current state of the economy and the rule of law, the coming elections are likely to be instrumental in shaping the future trajectory of the country and, to an extent, the region, especially at a time when there is increased regional instability. This is further compounded by the changing nature of elections in the digital age.

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