That come July 1st the government shall need funds to run it so not in any question. But where shall the funds comes from?
One of the means of raising the funds that has been suggested is the sell of 25% of the government shares in Safaricom.I love going against the tide of humanity and so I hereby set out my view on why we should not let go off Safaricom.
Safaricom happens to be the Kohinoor of the corporate sector in East Africa. It is the most profitable, most easily recognized symbol of success and potential gold mine for the owners. The government of Kenya and by extension the people of the Republic of Kenya is currently the majority shareholders with 60% of the ownership.
When the telecommunication sector was in a state of limbo with no growth in the horizon, the government entered into strategic partnership with Vodafone of U.K.This paved the way to what can only be said to be the most remarkable fete of growth and rejuvenation of industry. The introduction of a second operator in the form of Ken cell and later renamed Celltell upped the ante in the telecommunication sector. There has been a robust growth of the industry with more capital investment by various private companies. The buzz created has been such that the major companies like Nokia and Samsung have set up base here in order to tap into the growth industry. A recent survey in the Economist has equated the sector’s growth to the discovery of oil in the Middle East. The goose that is Safaricom has started laying golden eggs, which could be used to run the governemt and revive the other reeling industries.So,why I beg do we sell off Safaricom to private investors.? It is not true that with the sell more Kenyans will be able own it, because this offer will only be felt by the middle class and the urban dwellers who will be able to buy the shares.
It is true that the government cannot resist the temptation that is there with 30 billion due to be realized from the 25% sell off. But is it really the best deal for Kenya? The sell out would mean that Vodafone would be the single largest shareholder in the set up. With this all board room decisions would not be Kenyan in nature and I fear that we shall have let ourselves down. Look at it this way, after next year we shall still need more cash to run the government and more Safaricom shares would have to be sold to cater for the shortfall.So,what happens when we have no more Safaricom shares to sell? This reminds me of the story of the poor fellow who lived beyond his means and even sold his own furniture and bedding in order to finance a life of spending and affluence. You can guess his status after he had lost all his earthly possesions,he was reduced to a homeless pauper. So we should live within our means and cut down on extravagant spending to avoid privatizing our sovereignty.
Moreover the telecommunication sector in the region is bound to grow and the pond that is Kenya will be too small for Safaricom.Expansion in the region is what has enticed everyone with half a brain to call for privatization of the most profitable single entity in East Africa. The expected returns are just too good an opportunity for the clever chaps with pin stripe suits and power glasses to pass up. The most appropriate reason to privatize or divest from Safaricom,Telkom,Kengen or any other firm is if the returns are dwindling even after measures of restructuring and proper management, or if the perceived returns are lower than the anticipated taxes if they were privately owned. I bet Safaricom has not reached that point by a million mile. But we still insist to sell it off.
So,what reason do we have for divesting from the most profitable company in East Africa. Is it out of our own volition or has it been forced up our throats?
The government with all the resources of big brains should look at other alternative means of raising the 30 billion for the next fiscal year without slaying the goose that lays the golden egg. My simpleton brain has several workable suggestions, and none has sell of Safaricom as one of the options. Living within our means is just one of them. I beg you to ask me how different I would have it.
Friday, June 15, 2007
Friday, June 8, 2007
LEADERSHIP CHALLENGE(an open letter to .....................
It is the dream of every generation to lead any nation into the Promised Land. But to get there, visionary leadership and a look at the big picture is important. As it is today, we have been led by one generation of leaders from independence to date. A lot has been achieved but its time for transition and change into the new generation of leadrship.Hence I make a case for a technocrat president.
The Kenyan nation is mired by a myriad problem that seem never ending. Some of the problems facing this nation are:
Mismanagement:
Everyone aspiring to make a quick buck at most minimal hassle knows that to land a plump government appointment is the way. Thus everyone hanging on to their cronies to give them the best gift one could ask for, manna from heaven. This way CEOs with no grasp of management have been created with subsequent failure of those bodies to perform. It was hence thought that its normal for parastatals to be loss making and dependent on central government. I guess the turnaround experienced by restructured or recently privatized parastatals e.g. KPLC have dispelled this myth. It’s the management that was lacking and once this was corrected the benefit has been noticeable.
So, the way to go could be to have more reforms and restructuring of the organization of remaining parastatals with an emphasize on meritocracy and performance delivery. This way, control remains with the main shareholder (state) and the effect would be better Kenyan ownership of the utilities that make money.
Financial constraints
The fact that we are now able to fund the government budget almost exclusively from within attests to the availability of finances to run the nation. But we should also note that other than increased revenue collection by increased tax base, we also have been offloading government stake at Mumias and Kengen.These are short term gains that beg the question, what shall we do when we have no more companies to sell?
The solution to this could lie in the earlier issue of management. With the sell of un-salvageable industries, we could improve management in key areas to cut down on operational costs. This will enhance service delivery and more people would benefit from the services they need and desire.
Inequitable distribution of resources
It is a difficult to balance while allocating fund for projects. But some obvious glaring anomalies can be seen every time the budget allocation is read.(remember the lopsided road funds allocation.).Another dilemma has been the absentee landlords and the squatter problem. The poor and the underprivileged have been made to think that they are lazy and need to dependent on handouts. But the moment we stop postponing the resolution of this problem and focused our energies in correcting social injustice by redistribution of wealth, through agreement with he parties concerned, then the poverty would be alleviated. Look at it this way, 1000 acres lying dormant over many years only adds value to the owner of the land, but does not exert much revenue collection. But redistribution and subdivision into 1000 one-acre plots would increase the peoples buying power and thus more revenue base for the taxman. This is what is economic empowerment.
Corruption
This is not a department within an organization. It is a monster created by the lack of transparency of operations and the lengthy bureaucracies in conducting transactions.So,if the services were delivered as a right of the people it would die a natural death. But we also need to ensure the punishment for corruption are severe stiff and immediate, without it being selective.
Tribalism
Which tribe do you belong to? That is the standard first thought of the old generation that had it inculcated into their minds that there was “Us and Them” based on tribe. This tribal mindset is surely not as engrained in the youth as can be seen by the appreciation of all Kenyan cultures, that Tony Nyadundo could be a big draw in So-called Kikuyu towns. Even the youth initiative of Vijana Tugutuke campaigns are a step in the right direction.
So, we need a truly Kenyan identity for our future. We need to tap into the youth through Vijana Tugutuke.
Economic growth/Foreign investment
An unfortunate curse of economic growth is that it is fueled by foreign investments. It is true that we are experiencing economic boom at the stock market and the performance of industries. But we need to ask, who controls them? Foreign investment in the growth industries is substantial, thus the gains experienced only fuels further foreign investment and the growth can be said to be felt more out of the borders of this nation. Kenyans are just spectators in the big businesses like the AGOA-initiative fueled growth in textile industry. This is due to lack of massive capital needed for such investments.So,we have to be content to providing sweat shops for the foreigner exploitation of Kenyans, and repatriation of the proceeds.
We have to look for ways in which the state can invest in the high returns sectors and effectively manage them. I believe government owned industries in textile could have an impact in terms of job creation from the raw material production (cotton farming) to manufacturing and distribution. The profits would thus be retained locally.
Health
We are ravaged by many diseases, some of them preventable. A reform of the health sector enabling access to health by all will be a welcome move. An intersectoral approach would be crucial, as ill health is actually in many cases a failure in another sector .E.g. water borne diseases due to lack of water could be prevented by building boreholes and education.
Unreliable politicians
If we were to get a penny for each unfulfilled promise made by a politician since independence we could be the richest nation on earth. We have lived with politicians squabbles and lack of delivery of promises for too long.Thus,the leadership of this nation requires someone with a track record of success and who has made a difference. It also needs integrity and lack of any discordance in words and deeds.
All of the challenges highlighted above can be overcome. We have a lot going on for us, that I think all we need is direction and off we shall go. What makes Kenya unique and hopeful are many and could take a whole book to explain. In short, we have the best human resource a firm could ask for. Daily a lot of Kenyans with brilliant minds and passion to serve are graduating. The new technologies are being adopted by the youth faster than many other countries and are instrumental in being in touch with global trends. We have great agricultural lands that could be used well through the land reforms suggested earlier. Above all we are a melting pot of different cultures, races and religions.
We have to think critically and understand that for there to meaningful change the thinking of the leadership should not be conservative, but rather visionary and trailblazing.
So I just have to beg to ask, do you think you could be the visionary leader that this nation has been waiting for. I could be right in having the feeling that you are best choice for Kenya, or am I delusional?
The Kenyan nation is mired by a myriad problem that seem never ending. Some of the problems facing this nation are:
Mismanagement:
Everyone aspiring to make a quick buck at most minimal hassle knows that to land a plump government appointment is the way. Thus everyone hanging on to their cronies to give them the best gift one could ask for, manna from heaven. This way CEOs with no grasp of management have been created with subsequent failure of those bodies to perform. It was hence thought that its normal for parastatals to be loss making and dependent on central government. I guess the turnaround experienced by restructured or recently privatized parastatals e.g. KPLC have dispelled this myth. It’s the management that was lacking and once this was corrected the benefit has been noticeable.
So, the way to go could be to have more reforms and restructuring of the organization of remaining parastatals with an emphasize on meritocracy and performance delivery. This way, control remains with the main shareholder (state) and the effect would be better Kenyan ownership of the utilities that make money.
Financial constraints
The fact that we are now able to fund the government budget almost exclusively from within attests to the availability of finances to run the nation. But we should also note that other than increased revenue collection by increased tax base, we also have been offloading government stake at Mumias and Kengen.These are short term gains that beg the question, what shall we do when we have no more companies to sell?
The solution to this could lie in the earlier issue of management. With the sell of un-salvageable industries, we could improve management in key areas to cut down on operational costs. This will enhance service delivery and more people would benefit from the services they need and desire.
Inequitable distribution of resources
It is a difficult to balance while allocating fund for projects. But some obvious glaring anomalies can be seen every time the budget allocation is read.(remember the lopsided road funds allocation.).Another dilemma has been the absentee landlords and the squatter problem. The poor and the underprivileged have been made to think that they are lazy and need to dependent on handouts. But the moment we stop postponing the resolution of this problem and focused our energies in correcting social injustice by redistribution of wealth, through agreement with he parties concerned, then the poverty would be alleviated. Look at it this way, 1000 acres lying dormant over many years only adds value to the owner of the land, but does not exert much revenue collection. But redistribution and subdivision into 1000 one-acre plots would increase the peoples buying power and thus more revenue base for the taxman. This is what is economic empowerment.
Corruption
This is not a department within an organization. It is a monster created by the lack of transparency of operations and the lengthy bureaucracies in conducting transactions.So,if the services were delivered as a right of the people it would die a natural death. But we also need to ensure the punishment for corruption are severe stiff and immediate, without it being selective.
Tribalism
Which tribe do you belong to? That is the standard first thought of the old generation that had it inculcated into their minds that there was “Us and Them” based on tribe. This tribal mindset is surely not as engrained in the youth as can be seen by the appreciation of all Kenyan cultures, that Tony Nyadundo could be a big draw in So-called Kikuyu towns. Even the youth initiative of Vijana Tugutuke campaigns are a step in the right direction.
So, we need a truly Kenyan identity for our future. We need to tap into the youth through Vijana Tugutuke.
Economic growth/Foreign investment
An unfortunate curse of economic growth is that it is fueled by foreign investments. It is true that we are experiencing economic boom at the stock market and the performance of industries. But we need to ask, who controls them? Foreign investment in the growth industries is substantial, thus the gains experienced only fuels further foreign investment and the growth can be said to be felt more out of the borders of this nation. Kenyans are just spectators in the big businesses like the AGOA-initiative fueled growth in textile industry. This is due to lack of massive capital needed for such investments.So,we have to be content to providing sweat shops for the foreigner exploitation of Kenyans, and repatriation of the proceeds.
We have to look for ways in which the state can invest in the high returns sectors and effectively manage them. I believe government owned industries in textile could have an impact in terms of job creation from the raw material production (cotton farming) to manufacturing and distribution. The profits would thus be retained locally.
Health
We are ravaged by many diseases, some of them preventable. A reform of the health sector enabling access to health by all will be a welcome move. An intersectoral approach would be crucial, as ill health is actually in many cases a failure in another sector .E.g. water borne diseases due to lack of water could be prevented by building boreholes and education.
Unreliable politicians
If we were to get a penny for each unfulfilled promise made by a politician since independence we could be the richest nation on earth. We have lived with politicians squabbles and lack of delivery of promises for too long.Thus,the leadership of this nation requires someone with a track record of success and who has made a difference. It also needs integrity and lack of any discordance in words and deeds.
All of the challenges highlighted above can be overcome. We have a lot going on for us, that I think all we need is direction and off we shall go. What makes Kenya unique and hopeful are many and could take a whole book to explain. In short, we have the best human resource a firm could ask for. Daily a lot of Kenyans with brilliant minds and passion to serve are graduating. The new technologies are being adopted by the youth faster than many other countries and are instrumental in being in touch with global trends. We have great agricultural lands that could be used well through the land reforms suggested earlier. Above all we are a melting pot of different cultures, races and religions.
We have to think critically and understand that for there to meaningful change the thinking of the leadership should not be conservative, but rather visionary and trailblazing.
So I just have to beg to ask, do you think you could be the visionary leader that this nation has been waiting for. I could be right in having the feeling that you are best choice for Kenya, or am I delusional?
Wednesday, May 30, 2007
AWAKEN FROM THE SLUMBER
Hope and dream for a better tomorrow for the people of Kenya and humanity in general is all i have.I guess the sheer logic and romantic grasp of social justice movements have enveloped my psyshe.I wish Kenyans can think and think and finally we can come to the realisation that humanity is all about helping those in need and not just acquire much and not giving back any.
Subscribe to:
Posts (Atom)