KIBAKI legacy is too Cosmetic

I call us a Prozac nation because I am amazed at how much Kenya has continued to backtrack but each time, the Leadership headed by none other than Kibaki gives you all a small dosage of Prozac and you forget your troubles. Your depression is replaced by a plastic smile which only lasts until the next shot. For me to really make you guys remember how much we have been sleeping as a country, I will take a facts only, references only, statistics only approach to convince you that Kibaki and Kenyans in general are asleep. Simply put, here are some 5 pillars of economic growth as per vision 2030. I will however center my argument on the pillar number 5 which anyway props up the other 4. Without a Financial Sector that is functioning, there is no 1, 2, 3 & 4.

I - Tourism

II - Agriculture

III - Wholesale and retail trade

IV - Manufacturing IT enabled services (previously known as business process off-shoring)

V - Financial services and Housing

Kenyans still pay the highest interest rates in the world. At 20.34 in March 2012, we were only doing worse than 3 countries in the world, Zimbabwe 975%, Sao Tome & Principe 28%, Venezuela 28.5%. Taking a mortgate in the country at the average rate of 24% to build a house worth 5 million shillings out of which you put the least possible downpayment of 1% (technically impossible), in 10 years you would have been paying a monthly fee of Ksh.119,609.1 which translates to 14,353,000 total paid back over 10 years. Who in his correct mind is willing to enter this deal? Okay to put more perspective, compare with someone in some sheet African country……hmmm………..hmmmmm…….okay Gabon 5.25%, Equitorial Guinea 5.25% and Chad 5.25% even the war-loving Congo 5.25%. These guys for the same house will be paying KES 53,109.39 which translates to a total Ksh. 6,373,126. For every one house I can buy with a 5,000,000 shilling mortgage over 10 years, the former child soldier in Congo can buy two! The guy in Italy can buy 3 if he adds Ksh 647,000.

In other words, in Kenya, our financial system forces people to have ready cash if they want to build a house affordably. This means that only the rich (not even middle class) can afford homes. The rich will of course raise rents because of the special throne they sit on and more of you will continue moving into Kibera, Gachororo, Mathare, Kariobangi, Korogocho, Baba Dogo and all these places the government says are beyond help but yet the solution is simple.

When you do not have financing how are you going to build a hotel? Why do you think the best and biggest upcoming hotels in the coast are from Italian owners? Italians can borrow money from their financial system at 0.75% that is not even a 1% and invest it anywhere and on anything on our so called blue-planet; earth. Italians are here laying our chics at the coast and refusing to let us into the hotels even if we had money to pay for the meals. Kenyan companies, restaurants, boutiques and entertainment spots are being taken over by foreigners who have borrowed cheap. Wewe bado umesimama Githurai interchange admiring Kibaki’s work! Do you even drive? I do drive! I drive my mom’s hand it down car Datsun 1200!! I cannot even offer a chic a lift she’d think I am on Prozac.

Simply said, without a sound financial system there is no investment in Agriculture, (flower farms in Kenya are lately owned by Norwegians, Dutch, Lithuenians, save for the tiny tiny ones in Tigoni and Juja. You all are singing here maendeleo this maendeleo that ooh development. You guys are all on Prozac. The fourth Pillar of vision 2030 is Manufacturing and IT. Why is the loud mouth, drooling, zero IQ run CCK not cracking down on high internet charges? Bitange is the only smart guy who gives me hope of sanity. For those of you who work online, freelancers and what what. You may have noticed that some jobs say “Pakistani contractors only should apply”. Why? These folk have very fast internet for very cheap its almost free and their stima is almost unpaid for. They can do for a dollar what a Kenyan would need 5 dollars to do. Yes these are the guys we are competing against if Vision 2030 is to become reality. If Konza and Tatu city were to work out, we would need a strategy to beat Pakistan, India, South Korea, Malaysia. Kibaki the economist does not know that access to credit is access to investment, which in turn is access to income which is access to savings so that someone else can borrow. Kenyans keep being duped by small small syokimau type projects ever 2 years to cheat people that we are working. Depressed people who are smiling coz of drugs. Prozac nation!!!

References

1) CBK Rates and Statistics 2012 http://www.centralbank.go.ke/index.php/rate-and-statistics/interest-rates-2?yr=2012

2) Property Kenya Mortgage Calculator http://www.propertykenya.com/mortgage_calculator.php

3) List of Countries by Central Bank Interest Rates http://en.wikipedia.org/wiki/List_of_countries_by_central_bank_interest_rates

4) Hass Consult, List of Local Banks Mortgage rates http://www.hassconsult.co.ke/images/Quarter12012Special_Report.pdf

5) About the Anti Depressant, Prozac http://en.wikipedia.org/wiki/Fluoxetine

Source: THE KENYA DAILY POST