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Of Tigers, Debt Merchants and 2020 Vision

8 min read.

The former president of the African Development Bank, Donald Kaberuka, has dismissed as “nonsensical” any suggestion that Africa may have over-borrowed, saying instead that with better debt management and higher domestic revenue mobilisation, the continent can take on more debt. But Kaberuka fails to make the link between the increased borrowing and the revenue problem.

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Of Tigers, Debt Merchants and 2020 Vision
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The public debt burden has dominated economic debate in 2019. Public debt is likely to be even more topical in 2020, both domestically and globally. As at end November 2019, 31 out of 70 countries in the IMF’s roster of low-income countries are listed as either in or at high risk of debt distress. Another 26 are listed as being at moderate risk, leaving only 13 that are still at low risk. Last week, the IMF approved a $2.9b bailout for Ethiopia, one of the high distress risk countries.

I first called out the Jubilee administration’s borrowing binge six years ago. Up until two years ago, the IMF and the World Bank were still giving it the thumbs up. (Very often we forget that these institutions are lenders and therefore conflicted on matters debt.) A few weeks ago Donald Kaberuka, the immediate former president of the African Development Bank (AfDB) and erstwhile Finance Minister of Rwanda, dismissed as “nonsensical” any suggestion that Africa may have over-borrowed:

“The idea that Africa is drowning in debt is nonsensical . . . If we can improve on our own domestic revenue mobilization, if we can improve on our public debt management and if we can improve on our debt management capabilities, the continent is able to take a bit more debt, especially at this time when the markets are looking for yield.”

This is an interesting argument. You may also have heard it from the Jubilee administration—the problem is not too much debt; it is the Kenya Revenue Authority (KRA) that is failing to meet revenue targets.

Kaberuka, who I gather is an economist, wittingly or otherwise, fails to make the connection between the borrowing binge and the revenue problem. Only a most incurious economist would look at revenue and debt trends such as ours (see chart) and conclude that they are completely unconnected. Although I have written about the connection on more than one occasion, it is worth recapping. There are two dimensions to the connection: an accounting one and an economic one.

Let’s start with the accounting. Let’s say we start with a GDP of Sh10 trillion which is 80 per cent private economy and 20 per cent government. Let’s then say the government is raising Sh2 trillion, which is 20 per cent of GDP, in tax revenue. Suppose the government goes to China and buys a railway worth Sh500 billion on credit. The GDP will now be Sh10.5 trillion. We will be told that the economy has grown by 5 per cent. But the railway has not added anything to the economy, and nor is it paying tax, so the government still collects Sh2 trillion, but which is now 19 per cent of the Sh10.5 trillion GDP. If this is repeated every year, by year five, the GDP will have expanded to Sh12.8 trillion and the tax revenue-to-GDP ratio will be down to 15.7 per cent.

This is a purely accounting view, which assumes that government investment is neutral, neither helping nor harming the economy. This is not as far-fetched as it might at first appear. For example, it could simply reflect government investments with long gestation periods. Indeed, we have been told that the new Standard Gauge Railway (SGR) is one such long-term visionary project whose benefits will be realised by our grandchildren. But for no harm to occur, two conditions need to obtain. First, all the borrowing needs to be foreign. Use of domestic resources means diverting these from the private economy, and that is harmful. We call this crowding out. Second, there are no repayments, because repayment of foreign debt amounts to sucking money out of the economy, also harmful. Neither obtains.

Let us start with repayments. This year, we have budgeted to pay Sh139 billion ($1.39 billion) in foreign interest, a tenfold-plus increase from Sh11b ($130m) in the 2012-2013 financial year, the last year of the Grand National Coalition government. And this does not include the hefty payments of the principal on the SGR loans that kicked in this year. The use of domestic resources is also a very significant factor. Half the debt that the Jubilee administration has accumulated is domestic. The crowding out extends beyond credit. With so much money to spend liberally, trading with the government becomes the most profitable business, diverting other economic services away from, and inflating the costs for the private sector. This could not be better demonstrated than by the case of Kenya’s banking industry.

Chart 2Last year, the industry made a consolidated profit of Sh110b, and Sh119b in interest from government securities. Considering that lending to government is virtually costless and risk-free, this implies that banks made all their profits from the government, and lost Sh9b on the business they did with the rest of the economy. The contribution of interest on government securities has increased steadily from 37 per cent in 2013 to 108 per cent in 2018 (see chart). But we also see that the banks’ profitability has declined. Profits declined by 40 per cent in 2017, following the capping of interest rates in late 2016. In 2018 profits were 14 per cent lower than in 2013. If banks are not making money from the private economy, it stands to reason that government revenue will also take a hit.

How much public debt is too much?

Debt experts have sophisticated models that are supposed to tell us. These models are built around “present value.” Present value is the sum of a forecast, such as a cash flow, and in this case annual debt repayments, discounted by a rate of interest or other relevant discount factor, used to give an estimate of current worth. If two similar countries borrow the same amount of money on similar terms, one invests wisely, and the other plunders it all, the net present value of the debt will be the same. It should not surprise then that the IMF’s models were giving the Jubilee borrowing binge the thumbs-up even as the Eurobond went walkabout and one Josephine Kabura was mocking us with tall tales of cash stuffed in gunny bags.

Chart 3For the financial health of a country, a simple rule of thumb is to ensure that debt service does not grow faster than government revenue for too long. If the debt is invested productively, the investments expand the economy, the government generates more tax revenue from the expanding economy, which it then uses to service the debt. How long is too long? That is a matter of exercising sound judgement. As John Maynard Keynes famously quipped, in the long run, we are all dead. But the question becomes moot when the trend looks like what we see in the chart—debt service heading north, revenue heading south. You do not need present value calculations to see that this trend cannot go on for much longer. Sooner or later, something will have to give.

Expect to hear a lot about fiscal consolidation in 2020.

Fiscal consolidation is defined as policy measures that aim to reduce the deficit and stop the accumulation of debt. The substance of it is what we used to call structural adjustment but, following the 2007 financial crisis, it became necessary to invent a new name—it just wouldn’t do to speak of Spain, or the UK for that matter, as implementing structural adjustment.

A fiscal consolidation strategy is predicated on the expectation that governments can find ways of bringing down deficits without hurting growth. Budget deficits are, in essence, the pumping of money into the economy, which ought to stimulate growth. Conversely, fiscal consolidation amounts to withdrawing money from the economy, which would dampen growth. The problem is that economic slowdown hurts revenue, meaning that the government has to constrain expenditure even further to meet its deficit reduction targets.

The first strategy entails counteracting the contractionary effect of fiscal consolidation with expansionary monetary policy. Simply put, what the government takes away, the Central Bank puts back in circulation. The Central Bank has a couple of tools to do this, principally by buying bonds and lowering the cash ratio and liquidity requirements for the banks (the percentages of assets that banks are required to have in cash and near-cash assets such as Treasury bills and bonds). Shovelling money out of the door is also expected to reduce interest rates, which besides making borrowing attractive for businesses and consumers, can substantially lower the interest cost of domestic debt. But unlike fiscal stimulus where the government is the spender, monetary stimulus depends on market response. The policy makers hope the money will stimulate production, but it could just as well suck in imports, or leave the country to seek higher returns elsewhere, thereby depleting foreign exchange reserves and putting pressure on the currency.

The second strategy is to find “off-balance sheet” financing of public investment. The default alternative these days is the so-called public-private partnerships (PPPs). Simply put, PPPs are the public equivalent of equity financing. Instead of the government borrowing to build a hospital for instance, a private investor builds, and the government leases it. But PPPs have their drawbacks. First, to make them attractive to private investors, PPP projects are usually structured in such a way as to ensure that the investors cannot lose money—“de-risked” in financial lingo.

Second, PPPs are seldom commercially viable so, more often than not, the Government usually has to part-finance the project in order to achieve an attractive rate of return for investors. Third, PPP financing cherry picks projects with commercialisation potential, which typically will be projects that benefit more developed areas or better-off people in society. In economics, we call such policies “regressive”, meaning they transfer resources from the poor to the rich. Fourth, PPPs have a very high corruption risk—we need look no further than the stink that is the medical equipment leasing scheme known as the Managed Equipment Services (MES) project.

Another scheme is to shift debt and deficit financing from the national government’s books to quasi-government agencies, such as has recently been done by amending the law to allow the Kenya Roads Board (KRB) to issue bonds leveraged on the fuel levy revenues that are earmarked for road construction. Assuming an interest rate of, say, 12 per cent, each shilling of fuel levy revenue can be leveraged to borrow 8 shillings. Already, the KRB has published an expression of interest for transaction advisors to raise Sh150 billion. Suffice it to say that Greece used financial gymnastics of this nature to first be admitted into the Eurozone and to subsequently fake compliance.

PPPs have a very high corruption risk—we need look no further than the stink that is the medical equipment leasing scheme known as the Managed Equipment Services (MES) project

How much public finance does development require? There is perhaps no better place to benchmark than with the Asian Tigers.

Chart 4In the 70s, Thailand and South Korea were raising 13 and 15 per cent of GDP in tax revenue, well below Kenya’s 18 per cent, while Malaysia and Singapore were doing better at just over 20 per cent (see chart). But where the East Asians stand apart is that each of them was able to put at least a third of their revenue into investment. The real miracle here is how they managed to keep their recurrent budget to a maximum of 10 per cent of GDP, out of which they were also heavily investing in education. As economists Mahbub ul Haq and Khadija Haq observed, beneath the East Asian economic miracle lay an education miracle.

Chart 5It is also a miracle of public finance, specifically, public thrift. We hear a lot about the high saving and investment rate part of the story. What we do not hear about is the role of government in that story. In the early seventies, East Asian and African countries had similar national savings rates, but even then East Asian governments were contributing more to national saving and investment, although African governments’ contribution was also significant (see chart). A decade later, East Asian governments were still contributing over a third of national investment, while for African and other LDC governments this contribution fell to 11 and 6 per cent respectively. Consequently, we turned to foreign resources. By the early 80s, Africa was investing 20 per cent of GDP more than half of which was foreign-financed, while the East Asians were investing 30 per cent, 90 per cent of which was domestically financed.

In the 70s, Thailand and South Korea were raising 13 and 15 per cent of GDP in tax revenue, well below Kenya’s 18 per cent, while Malaysia and Singapore were doing better at just over 20 per cent

The East Asian experience is telling us that when people were too poor to save much, it is the government, and not foreign resources, that closed the gap between private savings and investment requirements. In economics, we postulate that saving is determined primarily by income, and investment by rate of return. As these public investments paid off, they boosted private income and consequently private saving. When countries save more, they need less, not more foreign resources to finance investment. Donald Kaberuka is telling us that we need to raise more revenue to enable us to borrow more. Is he ignorant or dishonest?

During his tenure, the AfDB became the lightning rod for infrastructure-led growth, a fallacy that this column has discussed before. In fact, the nonsensical comments echo sentiments in the AfDB’s 2018 Africa Economic Review, to wit:

“For much of the past two decades, the global economy has been characterised by excess savings in many advanced countries. Those savings could be channeled into financing profitable infrastructure projects in developing regions, especially Africa, to achieve the G20’s industrialisation goal. That this mutually profitable global transaction is not taking place is one of the biggest paradoxes of current times.”

You may want to note that the objective is to “meet the G20’s industrialisation goal.” The irrepressibly prescient Franz Fanon read in the tea leaves:

“The national bourgeoisie will be quite content with the role of the Western bourgeoisie’s business agent, and it will play its part without any complexes in a most dignified manner.”

And therein lies the rub.

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David Ndii is a leading Kenyan economist and public intellectual.

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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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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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