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Starin’ At The World Through My Rearview

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Starin' At The World through My Rearview
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Staring at the world through my rearview
Just looking back at the world from another level
Ya know what I mean? Starin’
~ Tupac Shakur

I was born on the fourth of July in 1989; the same day America celebrated its two hundred and thirteenth year of independence from the British and arguably one of the best years in Pax Americana’s global reign. On November 2nd of the same year the Berlin wall came down ending a 44-year protracted ideological war between the Soviet Union and America. The victory hailed the end of communism and the triumphant victory of Western liberal democracy. Francis Fukuyama, a neo-liberal intellectual opined in his magnum opus The End of History that the global war of ideas had now reached its final stage and with it man had reached his zenith of ideological evolution and the universalization of Western liberal democracy was his final form of human government. It was the end of history and the last man –the neo liberal self-actualising automaton- had reigned supreme. The polarity of global power was now centred on America and its western allies.

For my Kenyan parents who lived in Nairobi, 1989 was also to be an instrumental year in their lives. Their small political unit was now complete and they had a duty of raising three children. Secondly, being the only superpower America could now exert its hegemonic power to the world. The social, political and economic ramifications were to shape the directions of the global architecture and all actors, my parents included.

Economically, the dictatorial application of the infamous Bretton woods Structural Adjustment Programmes (SAPs,) that pushed for government cuts on spending, reduced borrowing, inflation and liberalisation of the economy had yielded poor returns for the Kenyan economy. Instead, they led to the closedown or privatisation of unprofitable state owned enterprises -the largest pool of employment to Kenyans-which rendered many people without sources of income. The shortcomings of SAPs, which had not factored that the Kenyan economy then couldn’t support an aggressive increase of an indigenous privatisation programme led to a steep increase of unemployment in the country. This led to an outflux of people particularly to the global north in search of greener pastures. And for those who were not able to leave the country for better opportunities, they “limboed” through the system and later on found sources of income through the creation of the informal based “hustler economy” which spread throughout the 90’s.

My parents were still fortunate to have steady sources of income but they instantly became the breadwinners not just for the nuclear family but also the wider extended family. Home became the launch pad for most of their siblings who were in their 20s. Without a proper political and economic programme at the state level, a form of egalitarianism, as was in my family, occupied that vacuum in many households and communities to withstand the failure of political imagination as espoused by the State and the western backed International Financial Institutions (IFIs)

Politically, with the end of the Cold War the most radical changes in world politics were to take place. In Kenya, a bandwagon effect of protests, reform and subsequent multi-party elections escalated. Forced by the international community and growing internal dissent, the Nyayo regime implemented political reforms; key among them was the repeal of section 2A, which restored back multi-party democracy. Kenya had its first multiparty election in decades, in 1992.

For my parents voting meant more than just exercising their political freedoms, which had been curtailed by the heavy hand of the Nyayo regime. It was an act to reinstate their right to breathe. You see, ten years prior, my parents bore their first child in very ominous circumstances. My mother went into early labour on August 2nd 1982, because she got a panic attack after hearing the gunshots, screams, and police sirens the day before, the day of the failed coup attempt of 1982. The state had denied her her right to breathe. Casting a vote could hopefully atone for its sin.

The 90’s also ushered in an expansion of the democratic space in Kenya as observed by the flowering of independent weekly magazines, the emergence of the first privately owned broadcast media outlet, Kenya Television Network in 1990, and the rise of Non Governmental Organisations (NGOs) which attempted to execute collective political or economic activities outside the state. Moreover, the opposition was now publicly challenging state dominance.

In spite of all the political reforms and a growing opposition challenging the excesses of the Moi regime, my parents never engaged in any form of political discourse. It was an unwritten taboo. Somehow it was as if the idea of an omnipresent and omniscient regime that could hear and read your private thoughts was engrained in their psyches. Perhaps they had imbibed the ethos behind the statement of former Attorney General Charles Njonjo that it was treasonous to even imagine the president dead. Talking politics meant making life harder than it was already was. Besides, neo-liberal democracy had now schooled them that the market forces would solve everything.

Culturally, the broader availability of mass media, personal computers, the Internet had dramatic changes inside Kenya. For my generation, the aggressive uptake of western culture mores through music and movies would shape our worldviews as teenagers and into adulthood. But also, they provided for a great coping mechanism and escape from the hard political and economic conditions.

The Millennia (Y2K) like all new things was received with much euphoria. The Jubilee 2000 debt relief campaign had managed to push for the cancellation of foreign debt and countries, particularly in the developing world had their debts pardoned. Kenya was a beneficiary. It was also preparing for an election two years away, where Moi would finally leave office. More than two decades in.

The Election of 2002 shifted something albeit momentarily in Kenya. The National Rainbow Coalition (NARC) spearheaded by former President Mwai Kibaki promised to deliver a future for the prosperity of all Kenyans. We believed them. The excitement was palpable. Kenya had finally made it. Moi was gone. We were unbwogable. The competency and liberal stance of the regime struck a chord at home. For the first time my parents talked politics. My dad in his euphoria during the vote count leapt towards the television as they were showing the results for his constituency and said; “This vote is mine” The sense of pride was admirable.

After that, political conversations became a staple at the dinner table, it was acceptable to agree, it was fine to disagree, and it was also alright to be neutral. My intellectual journey commenced here. Henceforth, politics became just that, politics. It didn’t rule our lives. Besides, the economy was doing well. A disappointing 2.9 per cent growth in GDP in 2003 became 7.1 per cent in 2007, the highest in 20 years. It was the strongest period of sustained growth for decades, and reflected improvements in virtually every sector of the economy. The government too delivered on its promise of free primary education, improved road and public works, transport, security and health services in the country. And despite the regimes failure to address the issues of ethnicity, land and corruption, for the most part Kenyans were content with their liberal and competency logic. Hence the reason most people view Kibaki’s regime more favourably than any other of the three regimes despite his big failures that almost cost the country its life after the 2007 post election crisis.

Surprisingly, even after our darkest moment during the Post Election Violence (PEV) of 2007/2008, which caused the death of at least 1,133 people, the rape of 3,000 and the internal displacement of 500,000 people, Kenyans still found the resilience and hope that led to one of our finest moments in our history. Then, on August 27th2010, President Kibaki, promulgated a new constitution in a mass ceremony in Uhuru Park, in front of 10 other heads of state. It was hailed with hyperbole as the start of Kenya’s “Second Republic” and a new era of freedom and opportunity.

It was in this liberal era that civil liberties could be exercised en masse. The arts and music scenes expanded. Freedom of worship and expression also became more widespread and it was in this era that Kenya saw the resurgence of numerous churches, mosques and other places of worship. It was also in this liberal era that I saw my dad weep in a church service for the first time. He could finally not only worship freely but also express his vulnerability as a man, which he had been denied in the last 24 years in an illiberal environment. His soul was free. Besides, his problems weren’t of the “Siasa Mbaya Maisha Mbaya” kind (A phrase popularised by the Daniel Arap Moi, ironically, which translated to Bad politics, Bad Life). Like a good son, these made me want to express myself like my father. I finally did but in a much deeper way. I went into the clergy so that I could be vulnerable, I could worship but more importantly I could be free.

At the beginning it was fulfilling, lives were changed, people were hopeful for the future and importantly, they begun to dream. Then something happened along the way, a new political dispensation came to the fore. A mirror image to the previous one, but only in form. Its substance was different but at the time few saw through the emperors new dress. It was embroidered with a youthful face and a digital hue. Nevertheless, something about it was grim and familiar but like all horrific experiences, the Kenyan psyche had buried it deep within its subconscious.

At that time, still a budding clergyman in my early twenties I was in charge of the prayer team at my local church. I would often receive requests to pray for men and women for various issues. The congregation members were predominantly from the class that Fanon called the native intelligentsia. Their issues were mainly of the kind that gives them bargaining power and stability in their racketeering endeavours: It was a job they wanted, or a promotion, or a business deal, or that relationship which they hoped to take to the next level to earn their place as a married man/woman –the kind of social sanction that bestows honour, prestige and privilege in a colonial state.

With the new regime, their supplications changed as well. In their inner sanctums of their confessions and supplications they confided in me. They were deeply seeking to understand what had happened to the dream that they saw their parents lurch to in 2002 when NARC took power; they also wanted to understand how the silence that they were all too familiar with had cropped back to their social architecture. A wound they had inherited from their parents that they thought their university education, social media and being part of the global community would save them from was reeking pus of a past that reminded them of their present reality.

They were back to the future. And unfortunately for them, the self-censorship of the church “body politic” coupled with a lack of a model or ideal of political engagement—an organizing theory of social action, to address their existential concerns left them only the more helpless and hapless. Disillusioned, angry and unable to help my peers, I left the clergy.

The millennial generation (a term widely credited to authors William Strauss and Neil Howe to categories those people born between 1980 and early 2000’s) is perhaps the most slandered generation in our recent memory and in the same token, greatly misunderstood. Mention “millennial” to anyone over 40 and the words entitled, spoilt, lazy and indisciplined will come back at you within seconds as some of the choice clichés used to describe millennials. We’ve all heard the statistics. We are delaying marriage and home ownership and having children for longer than any previous generation. And, according to The Olds, our problems are our entire fault. This is what it feels like to be a millennial. Not only are we screwed, but also we have to listen to lectures about our folly from the people who screwed us.

But generalizations about millennials, like those about any other arbitrarily defined group, fall apart under the slightest scrutiny. Contrary to the cliché, majority of millennials are not university graduates, can’t lean on their parents for help and they are not lazy or entitled. Every stereotype of our generation applies only to the tiniest, richest, Kenyan elite sliver of young people. And the circumstances we live in are more dreadful than most people realise.

For instance, after the 2007/ 2008 global economic collapse the impact of the financial crisis was transmitted to African economies not through the credit crunches and liquidity freezes that strangled advanced and emerging economies, but rather through the global recession that followed. Low commodity prices, depressed external demand, and declining remittances wreaked havoc. African economies suffered about $578 billion in lost export earnings over the two years after the collapse, representing 18.4 percent of GDP and five times the aid to the region over the period. Oil exporters suffered the largest losses, with a shortfall of $420 billion. Capital inflows, tourism receipts and remittances all declined in parallel, and trade financing plummeted significantly. The effect of that massive external shock on growth and poverty was severe. Kenya recorded its highest unemployment rate in 20 years as observed by the Euromoney institutional investor report.

For millennials who were entering the workforce in a broken economic system, the economic recession had a profound effect on the development of their careers. We have had to contend with competing for the extremely few entry, low paying slots and acquiring jobs outside of our areas of training as observed by a study conducted in 2014. The study titled Universities, Employability and Inclusive Development also revealed that it takes a university graduate an average of five years to secure a job in Kenya. And if this is the case for our Kenyan graduates, the special 1% of our population then we can only attempt to imagine the grotesque realities for the rest 99%. And Like the “hustler economy” of the 1980’s and the 1990’s, today’s unemployed have taken to the “gig economy”- a term that refers to the increased tendency for businesses to hire independent contractors and short-term workers – to help them make ends meet. Its ethical concerns notwithstanding, Academic writing, a new and quickly budding sector in which university assignments and projects by college students, particularly in the West are being outsourced to young Kenyan graduates at a fee, is a fitting example of an occupation within the “gig economy” that has provided for employment to many of the Kenyan unemployed youth.

The Western financial crisis of 2007-8 also challenged the foundation stones of the long-dominant neoliberal ideology. It failed the test of the real world, bequeathing the worst economic disaster in seven decades. Today politically and intellectually, it has become obsolete – and spasms of resurgent nationalism are a sign of its irreversible decline. This is why energetic authoritarian “solutions” are currently so popular: distraction by war, ethno-religious “purification” the magnification of presidential powers and the corresponding abandonment of civil rights and the rule of law.

In Kenya and Africa, the picture is different. Almost all nations were borne out of the Eurasian conquests. And upon the independence of these states the European elite undertook to manufacture a native elite that after their physical departure they could maintain economic control and extraction over the new-formed states. This native elite could never have held such incoherent quasi states together without tremendous reinforcement and legitimacy from outside, which was what sealed the lid on the pressure cooker. Today, with the collapse of the prevailing story of mankind –neo liberal democracy, the west has become weak and global powers like America and Britain have adopted a self-isolationist, real politik foreign policy posture. Without tremendous reinforcements and legitimacy from the mother countries, countries in Africa are now going through rapid convulsions, as their political elites are unable to control their populations. Most African states have taken to palace coups and elite consolidations to enforce a type of control within their quasi states, though without absolute economic and political sovereignty this can only be temporary.

The ramifications of this for the millennial generation in Kenya are grim. Foremost, with the increasing stringent immigration laws by countries in the global north to protect their borders and lock out immigrants, the route taken by the few privileged and educated Kenyans and Africans to migrate to the global North for better opportunities in the late 80’s and 90’s may prove more difficult for the millennial generation of the same cadre today. Most will have to stay in the country and deal with the internal convulsions.

The breakup of the superpower system has led to the implosion of state authority across the Kenyan landscape of economically and politically impoverished people – and the resulting eruptions cannot be contained at all. Destroyed political cultures have given rise to startling “post-national” forces such as Alshabaab, and the retreating west is creating a vacuum which if not managed properly can create fertile ground for entrenchment of such groups and their nefarious activities.

Today, the youth have to contend with dilapidating social services system, a debt driven economy,an illiberal, incompetent and corrupt regime, and a collapsing global order -which has no signs of creating a compelling narrative to fashion a desirable future. Yet, with all this factors stacked against the millennial generation I still feel there is a silver lining in our story.

The Kenyan Millennial generation, like none before it is more tech savvy, digitally connected, politically and socially “woke”, and by far the most educated generation in postcolonial Kenya to say the least. With these tools at our disposal we have the potential to create a better world for ourselves and for future generations. But this will not come through the mundane economic calculations, the endless solving of technical problems and the satisfaction of consumer demands as Fukuyama opined. The neo-liberal man that the Western capitalistic system created has only shown himself parsimonious and niggardly where men are concerned; it is only men that it has killed and devoured. Capitalism has finally collapsed and we must find something different. Africa is waiting in eager expectations from something from us rather than this Frankenstein of a man. We must now abandon his old dreams and beliefs and turn a new leaf; we must bring forth daring courage, imagination, idealism and work out new concepts, and try to set afoot a new man.

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The author is an analyst based in Nairobi, Kenya.

Reflections

Gold and Gemstone Policy in Kenya: The Devil Is in the Detail

Small-scale artisanal gold and gemstone mining is decades-old but lack of knowledge and expertise, and limited support from the government have hampered the sector’s development.

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Gold and Gemstone Policy in KenyA: The Devil Is in the Detail
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The evergreen town of Kakamega is a picture of the hustle and bustle typical of any Kenyan town, with many hundreds of folks going about their daily business. But as you leave the town behind, the environment changes, a lush countryside of cultivated fields and densely planted trees giving no hint of the gold mining taking place in the nearby locality of Ikolomani.

Across the country, 432 miles to the southeast of Kakamega is the beautiful transit town of Voi, the largest town in Taita Taveta County which lies at the foothills of the Sagalla massif. But the much smaller town of Mwatate is the county capital, and the source of gemstones that Kenyans from other parts of the country know little about. Mwatate has rubies, red garnet, emeralds, moonstones, tsavorite, okenorite, and many more.

Small-scale artisanal gold and gemstone mining has been going on for decades in both Kakamega and Taita Taveta counties, undertaken mainly by local artisanal miners and by a few non-locals and foreign nationals.

The Mining Act 2016 recognises three levels of mining rights: artisanal mining permits, small-scale mining permits and large-scale mining licences. The small-scale permits and large-scale mining licences are issued at the national level through the Kenya Mineral Rights Board (MRB), while the artisanal mining permits are issued through the county artisanal mining committees. The Mineral Rights Board and the county Artisanal Mining Committees are administratively governed by the State Department of Mining under the Ministry of Petroleum and Mining. The Director of Mines and his representatives in the various counties are in charge of overseeing the implementation of the ministry’s policy frameworks. The Ministry of Petroleum and Mining has key mining regulations in place to govern this process.

But even though the Mineral Rights Board is in place, the process of setting up the county Artisanal Mining Committees (AMCs) has been long drawn out and there seems to be no hurry to implement the mining regulations that were commissioned in 2017. Kakamega County’s AMC was gazetted on 27 March 2020 and the team commissioned on 20 July 2020. However, the AMC has yet to begin its work as the key governmental mechanisms necessary to run the committee are still pending and so no mining permits have been issued to artisanal miners in Kakamega County since the gazettement.

Artisanal miners in Taita Taveta County are in a different situation altogether. The list of members of the county AMC constituted through their appointing authorities has been forwarded to the Ministry of Petroleum and Mining but the AMC has yet to be gazetted. When contacted on this issue, one of the reasons cited by the ministry officials was that factions within the mining fraternity have disputed the list of people proposed to be part of the AMC.

Applications for small-scale mining permits are submitted to the Mineral Rights Board through the Mining Cadastre Portal. The platform is meant to bring these services close to the miners but they complain of the slow response from the Ministry of Mining. They must travel to the ministry to submit the paperwork even after uploading it onto the portal. Access to a stable internet connection is also a challenge in the remote areas of Taita Taveta and Kakamega while some of the small-scale miners lack the capacity to use the online system. Most have to travel to the Ministry’s offices for assistance or else hire someone with the skills to undertake the work for them, rendering the application process both tedious and time-consuming.

The ministry has not undertaken any capacity building and shows a lack of commitment to make the system more efficient and user-friendly. The biggest hindrance, however, is the low budgetary allocation made to the Ministry of Mining, which leaves the staff with limited options in their efforts to serve small-scale miners.

The stated goal of the Mining Cadastre Portal is “to provide an electronic platform for all stakeholders in the mining sector in Kenya to engage directly with the Ministry of Mining.” Existing mineral rights holders (those with mining permits and licenses for mining) or those with pending applications can download, complete and upload the requisite documents. Prospective mineral rights holders can also submit their particulars and other supporting documents through the portal.

The portal is also a one-stop shop for information on mining activities in Kenya. It has a cadastre map of the key areas with mineral resources, as well as details of licence holders, and on-going applications; a click on any part of the map automatically displays the existing information about that specific geographical location.

For artisanal and small-scale miners (ASMs) in Kakamega and Taita Taveta, the portal has had a significant impact on access to public information on mining in Kenya. But the portal also has its limitations. Mining is a highly skilled sector that requires high levels of expert knowledge. Some of the requirements on the portal are beyond the scope of knowledge of most gold and gemstone miners in Kakamega and Taita Taveta. For instance, the portal requires a miner to take the coordinates of the area for which they are applying for a permit. This requires equipment that is typically used by geologists and land surveyors and that is expensive to hire or purchase. A sketch of the area or locality where the miner intends to undertake extraction is another requirement, a very sophisticated process that miners in general cannot undertake on their own.

Lack of knowledge and expertise coupled with lack of access to the internet, or even computers, therefore leaves the small-scale gold and gemstone miners unable to fully exploit the portal.

Aside from these limitations, however, the Kenya Mining Cadastre Portal has been a game changer when it comes to eliminating brokers from the mining sector and it has proven to be a more efficient system than the manual issuing of permits and licences

For instance, unlike the manual system that had no clear guidelines regarding payments, all fees due to the ministry are clearly indicated on the portal and paid directly to the ministry through a cashless system. Moreover, as the portal has centralised all the country’s mining information, cases of loss or manipulation of files or documents have reduced significantly.

The gold and gemstones that are mined in Kakamega and Taita Taveta are exported out of the country with or without any value addition under the provisions of the Mining Act of 2016 which require an export permit from the Cabinet Secretary the application for which is made on the Mining Cadastre Portal.

But while the law on the issuance of mineral export permits is sufficiently detailed, its implementation is the biggest challenge and I have no doubt at all that gold and gemstones are imported into and exported out of Kenya without any form of declaration. There are many routes along the porous Kenyan boarders through which the minerals can slip in or out of the country.

For instance, most of the gold that is mined in Kakamega is taken to Uganda by road undeclared. How can this be remedied, especially for gold and gemstone miners who want to run a clean business? Also, the process of implementing the gold refinery centre in Kakamega and the gemstone value addition centre in Voi remains pending. If the sector is streamlined, then the issue of traceability of gold and gemstones will be resolved and the mineral export licence will be of value to the artisanal and small-scale miners in the sector.

The article is done with support from Diakonia Kenya Country Office under the Madini Yetu Wajibu Wetu (Our Minerals, Our Responsibility) Project. Views expressed in the article are those of the author.

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Reflections

Sustainability Is Key in the Management of Natural Resources

For mineral wealth to have a positive impact there must be transparent policies, reasonable public regulation, commodity flows and sustainable and varied production systems.

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Sustainability Is Key in the Management of Natural Resources
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Natural resource wealth has massive potential and can hugely impact the economy of a country. The natural resource sector and more particularly the petroleum and mining industry is distinguishable from other sectors of the economy in that ventures in this sector are high-risk and prone to failure if not competently undertaken. Moreover, resources in the sector are typically immovable and must be exploited on the site of their discovery.

Being exhaustible and non–renewable, these resources call for prudent exploitation and management that must also factor in intergenerational equity. And unlike other industries, the exploitation of natural resources is community-based, in the sense that the activity takes place inside communities, providing opportunities for conflict as the business pursuits of an investor threaten the general welfare of the community.

Despite the lucrative nature of the sector, it comes with a number of challenges. Learning from the many countries that have experienced the “resource curse”, it is imperative that from the outset, the following issues are taken into consideration if at all a country wishes to progress and develop through the proceeds of its natural resources.

First, a country endowed with mineral resources should always plan to diversify its economy using the proceeds from its mineral wealth. This is done to avoid the Dutch disease and to ensure that the economy can withstand shocks caused by fluctuating prices. Venezuela and Nigeria are two countries that experienced economic recession due to a fall in the price of oil.

Second, while mineral exploration and production automatically comes with a high pollution risk, there is need take contingency measures to mitigate any such damage. Deliberate steps need to be taken to avoid the Niger Delta situation where land has been so degraded that the cost of cleaning up is estimated at £900 million.

Third, the phrase “resource curse” arises from the many cases where the discovery of minerals has resulted in retrogression instead of progress for the communities within which the commodity has been found. More often than not, these host communities experience conflict when the expected benefits are not realised, sometimes because of unrealistic expectations but more often because of corruption. It is important for investors and communities to engage from the outset, ideally with the government facilitating the process. Increasingly, however, civil society and religious organisations are stepping in to fill the gap left by unresponsive governments.

It is clear that natural resource wealth can provide opportunities for countries to improve the living standards of their people and can positively impact the development of nations. Indeed, it is a commonly held belief that nations richly endowed with natural resources are more advantageously positioned to shape the economic, physical and social aspects of their development than those less endowed.

However, the paradox of plenty has been the subject of extensive research by scholars and practitioners precisely because many resource-rich countries are associated with increased poverty levels, civil war, reduced economic growth, greater inequality and social injustice. This is because of a lack of goodwill to develop other sectors of the economy that are not necessarily dependent on natural resources, among other factors.

There are however, countries that can be cited for having taken off successfully.  Norway, one of the world’s richest economies, and Botswana, one of the largest producers of gemstones, have both clearly demonstrated how natural resources can be harnessed to foster development, build the economy and generally improve people’s livelihoods.

Conversely, countries like the Democratic Republic of Congo, with its has huge deposits of natural resources including cobalt which is highly sought after and is of great economic value, and Angola, with its vast reserves of natural gas, are examples of how resources can come to be regarded as a curse due to the civil wars, conflicts, under-development, low GDP, and the many other problems associated with these nations despite being resource-rich.

A number of academic studies also suggest that natural resource wealth slows down the economic growth of a country. This narrative is however challenged by countries like Singapore, the United Arab Emirates and Taiwan which, despite being modestly endowed, have invested the revenue from their limited natural resources in the areas of education and research, have strengthened their policy and legal frameworks and institutions, and established parameters for advancing wealth creation and multiplication, as well as savings for the future generations.

Many theories have been advanced in an attempt to explain the resource trap in mineral rich countries. However, none of the hypotheses advanced has identified the root cause of the paradox of resource abundance. This is because, by themselves, natural resources cannot be classified as either a curse or a blessing; they are opportunities that prudently exploited can jumpstart an economy and bring long-term fiscal benefits to a country.

Unfortunately, a majority of resource-rich countries are anti-democratic and have opaque policies and institutions. Predatory governance, greed and corruption often lead to the signing of secretive and exploitative production contracts that only benefit the investing multinationals and their countries of origin.

However, there are many tried and tested strategies and approaches that have resulted in strong economies with stable and functioning governments. For mineral wealth to have a positive impact and be a blessing there must be transparent policies, reasonable public regulation, commodity flows and sustainable and varied production systems.

A good example is the resource-rich state of Alaska in the United States where 9.6 billion barrels of oil were discovered in 1969. That year Alaska collected US$900 million from the oil lease sales but all the money was soon squandered. Worried that money from the oil resources would go to waste and benefit just a few, Alaskans voted to have the proceeds spent on state development.

Seven years later, and with infrastructure development largely achieved, a public vote established the Alaska Permanent Fund through a constitutional amendment. The fund was designed to receive at least 25 per cent of the oil revenue and in 1982 a dividend programme was added to the fund. The sovereign wealth component promotes and ensures intergenerational savings while the dividend fund ensures that all residents of Alaska enjoy the fruits of their natural resources by receiving annual dividends in the form of cash transfers. Since the first deposit of US$734,000 was made in 1977, the fund had over US$64 billion dollars in 2019 with each resident of Alaska receiving US$1,606 in dividends that year.

From the example above, it is very clear that a country can truly develop using its natural resource wealth. One of the ways in which it can do this is by securing tenure rights to natural resources through regulations that determine who can use the natural resources, for how long and under what conditions. Tenure rights clearly specify the expectations of each stakeholder with regards to their roles and, importantly, the role that the hosting communities are going to play during the entire period of the extraction of the resource.

Contract transparency is another way in which good governance can prevail in the extractive industry. Resource extraction contracts signed between the host governments and the multinational companies should be made public to provide general information to the public and ensure transparency, scrutiny and accountability.

There are countries, like Ghana, that support the idea of contract transparency as a fundamental principle in managing their extractive industry, but many nations have not fully embraced the idea of contract transparency for fear of sparking public outrage and also to conceal the information for personal gain. Through contract transparency, everything that is in the contract is laid bare and the specific expectation from every stakeholder is made public. This promotes good governance and transparency and also ensures that the benefits trickle down to the community level, promoting sustainable development.

Creation of a strong regulatory and institutional framework is also another way of ensuring good governance in the management of natural resources. The legal or regulatory framework can either enhance or inhibit development in the extractive industry and there is no template for what needs to be done in order to ensure a strong legal and regulatory framework. Each country has a unique opportunity to come up with its own tailor-made legal and regulatory framework that works for it and this involves developing laws and regulations that address specific issues in the industry while at the same time safeguarding the interests of the communities and  incorporating international best practices.

Having competent and functional institutions to implement the laws and regulations is another important step towards ensuring good governance in the management of the extractive industry. For the enacted laws to be effective, they must be implemented by institutions that are proactive and competent. Narrowing the implementation gap by ensuring that what is happening on the ground is in tandem with the provisions of the law is one of the critical roles of functional institutions.

A strong civil society can help in ensuring good governance in the management of natural resources.  Civil society organisations provide information and have the moral legitimacy to set the resource governance agenda. They can help to democratise power in resource management, and can work to keep other resource governance actors like governments and companies accountable. The civil society plays many roles, among which is the monitoring role, where it ensures that all the state and non-state actors play their role effectively in the management of resources and, more importantly in monitoring and ensuring that benefits are realised at the community level. They also help in highlighting corrupt practices in the industry and non-adherence to the internationally recognised practices guiding the extractive sector. Civil society organisations also have a role in representing the views of ordinary citizens on issues of national importance, in this case the extractive industry.

Lastly, civil society also plays a role in setting the agenda to ensure that the interests of the public in general, and development, are given priority. According to the Institute of Global Environmental Strategies Report of 2007, governments are increasingly involving local communities and non-governmental organisations in the management of natural resources. The ways in which the different stakeholders are involved varies. In involving different stakeholders, the governments broaden the scope of engagement and possibly minimise the chances of achieving a negative impact, reduce conflict and increase efficiency in resource management.

And finally, natural resources cannot be discussed without mentioning the environment. In an effort to benefit from the natural resource wealth while dealing with environmental issues, the following principles should be considered: All decisions made must be anchored in best governmental practice in order to ensure best practice in perpetuity. Resources must also benefit communities away from the resource as the impact of pollution may be felt away from the immediate location of the activity. Where there is no scientific evidence of possible impact, an investor should provide contingency measures and where such evidence of possible impact on the environment exists—usually through an Environmental Impact Assessment—an investor must formulate measures to avoid harming the environment and a polluter must sufficiently compensate for harm caused. We must give future generations the same opportunity to have access to a healthy environment that we as a generation have been given.

The article is done with support from Diakonia Kenya Country Office under the Madini Yetu Wajibu Wetu (Our Minerals, Our Responsibility) Project. Views expressed in the article are those of the author.

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Reflections

Time To Address Compensation and Resettlement Issues in Kenya’s Mining Sector

The Land Act, the Mining Act and the Land Value Act are inherently contradictory and the country lacks a national policy on issues arising from involuntary displacement.

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Time To Address Compensation and Resettlement Issues in Kenya’s Mining Sector
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Vision 2030 promises to transform Kenya into an industrialised middle-income country and, to that end, proposes ambitious projects which include the Standard Gauge Railway (SGR), the Lamu Port-South Sudan-Ethiopia Transport Corridor (LAPSSET), multipurpose dams and the development of oil and other mineral resources among others.

Large-scale projects, including mining projects, catalyse socio-economic development, which is what many people expect and can easily see. On the other hand, they undermine human rights, cause livelihood disruptions and break up the social fabric of the affected communities. This article focuses on this second aspect and examines compensation and resettlement policy gaps and challenges with respect to the mining sector in Kenya.

Large-scale mining projects lead to involuntary displacement, deprive those affected of the use or access to their resources, disrupt sources of livelihood and interfere with the cultural fabric of the affected communities. International safeguards developed by the World Bank and the Africa Development Bank on involuntary displacement recommend that all community concerns must be taken seriously in the planning and implementation of all investment projects.

World Bank guidelines provide that involuntary resettlement should be avoided and where it is unavoidable, all the people affected must be fully and fairly compensated. Moreover, compensation and resettlement should be seen as an opportunity to improve the livelihoods of those affected. However, the legislation currently guiding compensation and resettlement in Kenya does not regulate these processes in a clear and specific manner.

Take for instance the story of Phase 2A of the Standard Gauge Railway (SGR) that runs from Nairobi to Naivasha traversing Nairobi, Kajiado, Kiambu, Nakuru and Narok Counties, a project which was delayed for three years due to land acquisition and compensation issues.

In the June 22 2019 edition, The East African published stories of human suffering caused by the project. A mother of three, Ms Kusero was promised Sh2 million for her quarter-acre property but a house made of recycled oil drums is all she received as compensation for allowing the SGR to run through her land. Hers was one of many such stories of families whose land was compulsorily acquired for the project. On paper, they were paid billions in compensation but in reality, only a few actually received compensation.

Ms Kusero says that for people like her there were no negotiations and raising grievances regarding compensation was extremely frustrating. “You go to the National Land Commission and you are asked to go to the Ethics and Anti-Corruption Commission. Then you are sent to the Directorate of Criminal Investigation and Director of Public Prosecutions before being bounced back to the National Land Commission. In the end you get frustrated without redress.”

The second story is about the extractives sector and concerns compensation owed by the Kenya Fluorspar Company to the Kimwarer Community in Kerio Valley. After exploration and confirmation of the existence of viable fluorspar, the company excised land and started its mining operations before it had compensated and resettled those it had displaced. There were no consultations whatsoever regarding compensation.

A task force report on the Review of Fluorspar Mining in Kerio Valley established that some attempts at compensation were made. In 1982, two cheques of Sh3,606,000 and Sh500,000 were released by the National Treasury to the District Commissioner to compensate the affected residents. The land compensation value was determined at Sh450 per acre of which Sh50 was deducted directly by the District Commissioner as contribution to a local school fundraiser in the Kimwarer area.

The affected residents who wanted alternative land in compensation were promised they would be resettled on Kilima I and II and Grosell farms in Uasin Gishu. They were also promised that they would receive shares in the Flourspar Company and in the Wagon Hotel in Eldoret town. Those among them who attempted to settle in the promised land were later evicted and accused of invading private property. To date, the victims of these atrocities have not received justice.

Gaps and challenges in the policy and legislative frameworks

Large-scale mining operations require massive tracts of land and often lead to significant human rights violations. Communities whose livelihoods depend on land find themselves in a struggle to defend their rights against the mineral rights granted to investors who are usually large-scale multinationals acting with the full support of host governments.

Kenya’s constitution sets out the general principles of equitable, sustainable and efficient use of land and establishes forms of land ownership. It vests ownership of mineral resources in the government, which means that any land with mineral resources can be compulsorily acquired in the public interest. It further protects the right to property from unlawful deprivation of ownership or limitation of enjoyment unless for public purposes or in the public interest in which case prompt, just and full compensation is required. It is from these provisions that mineral resource projects draw justification to cause involuntary displacement.

Kenya passed a new Mining Act in May 2016 to bolster the legal regime and reinvigorate the mining sector. The Act provides that where a mineral right disturbs or deprives access to the landowner, causes damage to property or occasions loss of earnings, the landowner may claim compensation whose payment must be prompt, adequate and fair.  It doesn’t define what “prompt”, “full” and “just compensation” mean. The mineral rights holder is responsible for all the compensation and resettlement costs.

Moreover, the Mining Act appears to overlook the sensitivity of cultural resources. It does not protect or seek to identify cultural assets. Instead, it provides that no demand or claim for compensation shall be made for any loss or damage for which compensation cannot be assessed according to legal principles. Cultural resources are sensitive owing to the level of emotional reaction they spark when interfered with. They include spiritual sites, shrines, medicinal plants and graves whose value cannot be determined using formal processes but only through consultations and negotiations in good faith. The World Bank’s cultural safeguards on involuntary displacement provide that cultural property should be identified, protected and appropriate actions taken to avoid or mitigate adverse impacts, and that interference with cultural assets may only be justified when the loss or damage is agreed to be unavoidable.

The Land Act empowers the National Land Commission on all matters related to compensation. The Commission has the responsibility to make inquiries and determine interests in the land, receive claims of compensation and facilitate just compensation. It does this on request from agencies seeking to compulsorily acquire land. From 2013 to 2019, the Commission paid-out Sh38.273 billion in compensation of which 75.2 per cent went to the SGR and road projects. Within the same period, neither land acquisition nor compensation was undertaken by the Commission for mining-related projects, which raises the question as to how land acquisitions and compensation for extractives are carried out.

Parliament passed the Land Value (Amendment) Act In 2019 to address concerns relating to compulsory land acquisition, compensation and resettlement. One of the gains in this law is that it defines “just compensation”, “prompt” and “full”, terms that are used in the Mining Act, the Land Act and in other laws without clarity.  Accordingly, “Just compensation” means a form of fair compensation that is assessed and determined on the basis of the criteria set out under the act. “Prompt” means within a reasonable period of time but not more than one year after the Commission has taken possession of the land. “Full” means the restoration of the value of the land, including improvements made on the land at the date of notice of acquisition.

It is to be noted that unlike in the past where the NLC was required to compensate the landowner before taking possession, the Land Value law now allows possession of the land before compensation is paid. This is contrary to the Mining Act which provides for prior payment of compensation. Taking possession before compensation would disadvantage the affected persons and the one-year period set for paying compensation is too long especially for large-scale mining projects that normally deprive the owner of use of property such as farmland, homestead and grazing areas. The World Bank standards require that compensation is paid in full before displacement or restriction of access.

The Land Value law also provides criteria for assessing the value of compulsorily acquired land based on a land value index to be developed by the Land Cabinet Secretary in consultation with county governments and approved by the National Assembly and the Senate. Assessing land value for compensation purposes requires wide consultations with the affected persons and the relevant agencies, which this Act does not seem to embrace. As provided for, the development of a land value index excludes the participation of the National Land Commission, land valuation agencies such as Surveyors of Kenya, government ministries such as the Ministry of Petroleum and Mining whose main work causes involuntary displacement.

Key issues and action required

The first issue is the fragmentation of the legal frameworks that guide compensation and resettlement in Kenya. The country lacks a national compensation and resettlement policy that standardises compensation and resettlement and ensures that all socio-economic and cultural issues arising from involuntary displacement are properly addressed. The national policy framework on compensation and resettlement should be developed taking into consideration international best practices and safeguards to provide a harmonised policy direction that considers all the complexities that come with involuntary displacement. The policy framework should broadly articulate compensation and resettlement in such a way that it is understood to be an opportunity for improving the livelihoods of the affected people rather than as a process to subjugate them and worsen their livelihoods. At the very least, regulations on compensations and resettlement should be developed for the Mining Act.

The second issue is the uncoordinated institutional approach for compensation matters. The National Land Commission takes charge of both land acquisition and compensation based on requests and funds from the acquiring agencies whose roles are often unclear. The suggested national policy should provide a clear framework for institutional coordination and harmonise the efforts of all relevant agencies; compensation and resettlement must be a multi-agency function. In this way, overlooking community concerns will be minimised and, more importantly, the processes will be more transparent and less fraudulent. Effective institutional coordination will also enable an integrated grievance redress mechanism.

The third issue concerns the land survey regime; it is mired in corruption, inherently opaque and exploitative. Compulsory land acquisition heightens emotions and ignites serious land speculation perpetrated by public officers with privileged information who collude with greedy elites to defraud the state through inflated land prices.

Reforms to introduce transparent land surveying and valuation are required. This means strengthening the policy frameworks and the institutions involved and also requires a robust mechanism for monitoring compulsory acquisition, compensation and resettlement. It should become policy that a compulsory land survey is undertaken prior to the compulsory acquisition of any unregistered land.

The fourth issue is the absence of cultural resources as a factor of compensation and resettlement in the available legislations. Disruption caused by extractive projects on the social, economic and cultural ecosystems of the affected people can never be truly compensated or restored. Compensation merely helps the affected persons to continue with their livelihoods but does not and cannot restore their exact loss.

Legislations guiding compensation should clearly recognise cultural resources and all assets with cultural meaning and value for the affected people as an aspect of the process of negotiating compensation. Effective community participation must be allowed in identifying and deciding the compensation for cultural resources that may be affected by mining projects.

The final issue has to do with the procedures for paying compensation. Where the project affects the whole family, it is unclear whether compensation is awarded to an individual or to a household. Capacity building for the beneficiaries on the use of finances is also a concern and because it is rarely undertaken, waste of compensation funds, family disintegration, homelessness and other socio-economic concerns ensue. Support mechanisms to ensure effective financial planning are therefore important.

The lack of a mechanism to monitor the payment of compensation is another concern, leading to serious irregularities, corruption and human rights violations. Furthermore, the approach to dispute resolution needs to be harmonised to recognise structures at the county level. As they currently stand, the Land Act, the Mining Act and the Land Value Act are inherently contradictory.

The article is done with support from Diakonia Kenya Country Office under the Madini Yetu Wajibu Wetu (Our Minerals, Our Responsibility) Project. Views expressed in the article are those of the author.

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