DIFFICILE PERIODE...

In all ways, Kenya is facing very difficult times ahead

Reflexions lues dans la presse kenyane de ce jour

FELLOW KENYANS, WE ARE being buffeted by a second crisis. No, I am not talking about the post-election fallout and turmoil and the continuing standoff regarding who gets what piece of the action.

I am talking about the breathtaking spiralling cost of living, eating and just existing and how it is fast overtaking more and more people’s ability to manage and to feed their families.

Kenya has more than half its population living on the wrong side of the poverty line and is in the top 10 league of the most unequal societies in the world.

Much of the 1990s and early part of this decade were lost years in terms of economic progress.

Add onto that the endemic corruption, misuse of power and disproportionate economic progress and gains of the last few years. The latter is most important.

Tourism and horticulture may have raced ahead, but some vital economic and social sectors that millions of Kenyans depend on such as sugar, pyrethrum and cotton have languished.

NOW, LET’S ADD ON TO THAT THE present and get closer to the nub of the crisis. Regardless of the reasons behind it, the hard fact is that Kenya needs to import a large slice of its staple foods: two thirds of its wheat; three quarters of its rice; over a third of its sugar; much of its edible oils, and so on.

In a bad year, and this is likely to be one, we will also have a strategic deficit of maize and will need to import, especially in the third quarter of the year.

There was a time, not long ago, when several people, myself included, advocated that we should not build up strategic reserves of maize but import domestic shortfalls because the former was exceedingly expensive.

Now all that is turned upside down. Consumption of food is outstripping supply and that is not a temporary blip. World food stocks are at the lowest they have been for years.

This is for a number of well-documented reasons: increasing consumption particularly in the fast growing economies of China and India; poor harvests, and the diversion of some of these products into making biofuel.

Prices are literally going through the roof. Wheat prices have doubled in a year, and on average, world food prices have increased by some 40 per cent this year alone.

The price of locally grown maize is rising by the week and is in the region of Sh1,400 per 90-kilo bag. It will not be long until it reaches the world price which is now in excess of Sh2,000.

Indeed, countries are now imposing restrictions or taxes on food exports in order to safeguard or preserve their domestic supplies.

There are very few food products that will be unaffected. If supply tightens and prices rise, one shifts to a cheaper food.

Demand for that product increases and prices rise accordingly.

Secondly, Kenya is in no position to buck the world trend because of the quantity of food it needs to import.

To round off the picture, there are three other factors: fertilizer prices, the post-election mayhem, and fuel prices.

As farmers are finding out, the former has doubled in less than a year. If one can afford it, all well and good. But many farmers can’t and are either cutting back on the acreage, or using less fertiliser.

EITHER WAY, WE END UP WITH REDUCED harvests. It is estimated that the main crop from our breadbasket in North Rift and Trans Nzioa will be at least 30 per cent less this year.

The second factor resulted in some of our crop being destroyed, reduced acreage under cultivation and delays in planting. It is an important negative cause but should be seen in the context of the other issues and not blamed solely for the price rises.

Thirdly there is the oil factor. Oil prices are now in excess of $100 a barrel, an all-time high even in real terms, and the supply and demand equation is such that we are unlikely to see much relief from that.

The trouble with oil price increases is that they affect literally everything that requires to be transported whether goods or people.

In conclusion, Kenya, and the world, is in the early stages of a price explosion. It has many ramifications. It will plunge more people into poverty.

It will have a negative effect on virtually all our social indicators, particularly in the nutrition and health arenas.

It will continue to result in serious social unrest as those prices bite and scarcities spread. It will test sorely the competence and capacity of government in reducing the impact and keeping social order.


Handle the inevitable food crisis before it is too late

ONE OF THE FIRST TASKS of the new coalition government should be to steer Kenya away from an impending food crisis, which is already having a devastating impact in many parts of the country and is threatening to become a global crisis.
The World Bank has already announced that 33 food-importing countries could face social unrest in the coming months because of rising food costs.

The impact of the food crisis has been particularly hard on the urban poor, as they are less likely to grow their own food, and suffer most from inflation-inducing forces, including the rising cost of fuel, which has been partly blamed for the crisis.

According to UN-Habitat’s State of the World’s Cities Report 2006/7, “Even in situations where a country produces enough food, hunger may persist in urban areas because when inflation hits food supplies, poor urban families may be forced to use up to 80 per cent of their disposable income on food, which means they have little money left over for non-food items, such as rent, school fees and transport.”

A researcher at the Institute of Security Studies in South Africa has noted that the impact of the food crisis will be felt most acutely in African countries, where there is already a lot of anger in urban areas around issues such as unemployment and lack of basic services, especially among the poor.

Kenyans are not known to protest over food prices – we tend to take to the streets only to voice our support or opposition to a political party or leader, not because we cannot afford to feed ourselves or our families.

But given our fragile political situation, rising inflation (now at more than 20 per cent), high unemployment, an impending drought and a declining economy, it won’t be long before people begin to protest in other ways – through crime, looting and violence

High food prices can thus lead to other forms of social instability and anarchy. This scenario is too horrific to even imagine.

What our politicians don’t seem to understand is that survival issues have the potential to bring about regime change. If they are not careful, and if they dilly dally with the country’s future, they will be forced out of office through civil action on a massive scale.

The current food crisis, which is already being felt by Kenyans, could erupt into a political crisis.

Because we have not had a government in place for more than three months, and because thousands of our farmers are sitting idle and dejected in camps, any attempts made by the Government to mitigate the impact of the food crisis will be a little too late – unless measures are put in place right away to increase subsidies to farmers (especially on fertilisers) and subsidising the cost of essential food items, especially for urban poor families.

Kenya is not big on subsidies (it took us years to realise that free education is the cornerstone of every successful economy, both in the developed and in the developing world), but perhaps it is time to come to grips with the fact that without subsidies on basic commodities and services, we may be heading towards becoming a failed state, where the majority starve and the minority remain oblivious to the dying around them.

Unless the Government addresses the food crisis as a matter or priority, the country will be ungovernable in a few months.

What minister would want a portfolio that is so challenging, it is doomed to fail? Before we get to that stage, let the new government navigate us through rough waters that lie ahead before the leaking ship that is Kenya sinks.