The tourism industry in Kenya – from safari tours to idyllic beaches – play a major role in the country’s economy.
• Purchasing of mobile computer laboratories so as to establish digital villages country-wide.
In the 2010/2011 budget, the government promised to focus on the following areas in order to further improve the economy:
• Promoting agriculture by expanding irrigation to attain food security and rural development;
• Encouraging growth of industries and small and medium enterprises for employment and income generation;
• Strengthening financial systems for sustainable development;
• Deepening tax reforms and enhancing governance; and
• Promoting development of property market and enterprise.
The lack of well structured implementation arrangements have been a challenge to the
successful implementation of government programmes. In 2003, the government enacted the Constituency Development Fund Act to channel directly 2.5 per cent of the total ordinary national revenue annually to the 210 constituencies. Bursary and the Road Levy funds are also allocated directly to constituencies. These devolved funds are intended to achieve equity in development between the regions, assist in employing artisans, capitalize rural- based enterprises and help in poverty alleviation. Through the Youth Development Fund, the government plans to conduct tailor-made courses on entrepreneurship, writing of a business plan and afford basic capital for young people keen to start small scale enterprises. Kenya has a small domestic market that does not matter much in the current global trading arrangement. It therefore believes strongly in regional trade agreements and thus belongs to the East African Community which brings together the five East
42 | The Parliamentarian | 2010: Issue Three - Kenya
African countries comprising Kenya, Uganda, Tanzania, Rwanda and Burundi. They intend to abolish customs duty, have one currency and ultimately attain political federation. Kenya also belongs to COMESA (Common Market for Eastern and Southern Africa) and actively participates in the World Trade Organization negotiations. It hopes to take advantage of these regional trading blocks to access the expanded market of over 100,000,000 people duty free. It further hopes to expand domestic consumption and boost regional trade to avoid dependence on exports to distant markets which is replete with several global vicissitudes.
In addition to carrying out these
bold political and economic reforms, Kenya must institute thorough administrative, legal and constitutional reforms immediately. As already observed above, the new constitution, would make impunity a thing of the past. Free enterprise requires strict
observance of laws. Capitalism can only thrive in an environment
where personal freedom, hard work, technical competence, commercial fairness and political competition are respected and the government’s legitimacy is based on winning an election whose results are acceptable to all.
Responding to the challenges Kenya is a rich country by all standards. For example, it collects about 20 per cent of GDP in taxes whereas its neighbours can only manage about 12 per cent. However its weak governance has caused the fiduciary risk to be high and thus investors, both foreign and local, often add these costs to their services and products making government contracts expensive. This increases the cost of doing business. The government has responded to this challenge by instituting bold administrative reforms so that public service is not regarded as a cash cow any more. It is when the public service is run by competent, experienced, honest and non-partisan bureaucrats that the private sector can deliver by