As the powers that be who dreamt of the lofty Big Four agenda come to terms with the actualization of the agenda,lets remember that a number of players will make a beeline for their El Dorado.Already they are all over the global seeking for a mean to accomplish their dream From New York to Quanzhou they will crisscross to seek deals.In all the sectors involved in Big four expect the following
1.Mergers of local well-connected companies and PE funds and incorporated in tax-havens:
Companies with strong ties to influential businessmen will be heavily bought into by PE funds or other multinationals.This will ensure quasi-local ownership that enables them to term its success as a Kenyan success.All the while the profits generated will be flown out of the country.
A number of the local elites will back different foreign players each running the corridors of power to seek favour to enable them out play their rivals.But all is just a sport for them and they will bot seek to really address the problems of the common citizen but to engradise themselves.
2.Clamour for free land and tax exemptions and concessions:
Since most of the developments in the housing plans and manufacturing require massive capital investment,the foreign investors involved will request and be granted free land to set up their housing units.Also they will seek for suspension of corporation tax and other tax exemptions and review of regulatory framework to facilitate their works.This is in the guise that they would create a lot of job opportunities for the locals and cheap housing(a fallacy).
Already the CS of Industrialisation has opened the floodgate by reducing the work permit costs for Indian investors in the textile industry.
All the while the local players will be struggling with high-interest loans and double taxation.
Lets remember this,in low cost housing construction,most of the material come already prefabricated and there wont be added benefit of need for local masons to put up the structures.All that the investors would require are casual labourers easily trained to mount structures.The reduced labour cost will be not passed on to the final buyers of the houses but will just increase the margins for the developers and their 10% kickback bossom buddies.
As a follow up to the previous post on my perception of the role IFC in shaping the agenda in Kenya,I would like to address the role of another puppeteer controlling the agenda setting in Kenya and around the world.
Bill Gates and His Gates foundation:
In as much as Bill Gates improved the condition of millions in tackling the HIV scourge and Stop Malaria initiatives.The organization has in the recent past been involved in moves that either signal intention to benefit from the giving back to society which would be almost like a Dr Evil Character out to benefit from saving humanity or he has just been carried away by his perceived greatness that he has decided he and his team knows the problems of Africans and the world and will go ahead and fix it in his own way.
Healthcare: The Gates foundation has been involved in partnerships with states to tackle diseases in the past.However in the recent past their partners are an odd outfit of vulture capitalists and for-profit companies such as IFC.Some of the deals the foundation now openly supports is one of privatization of healthcare in Kenya.This move seek to encourage additional private investments to achieve sustainable development goals. Bill Gates and EU in Shs 13billion private health funding
Moreover the foundation is already in continued funding of the Africa Health Markets for Equity program to the tune of $60million.This initiative is multi fold and involves both increase private healthcare service provision,policy review and financing for expansion through the Medical Credit Fund.It basically is a set-up that creates a parallel health system instead of assisting states in achieving their goals of providing medical care to the citizens.
The foundation has also invested in collaboration with IFC and private equity funds huge sums of cash to increase health private sector.You just have to wonder at the double life of Bill Gates,a man who would pass off as a saint for the role in control of infectious diseases and his Dr Jekyll capitalist alter ego who invests in ventures that seek to take the little that the poor of Africa have to spare. Agriculture:
Its worth noting Bill Gates holds
$23.1 million worth of Monsanto shares.(Not that it counts as much to
him).
Media reports have reported on the progress of the testing and just just as a coincidence this week a feature on KTN had the following on the issue.
To cap it all,at the started of the year Melinda Gates came calling and visited State House Nairobi where she discussed various issues including support for agriculture and healthcare.
3.Melinda Gates visits State House and holds talks with the President The irony of all this is that a couple who disposed of their wealth in pursuit of cure and treatment for infectious diseases now find themselves supporting solutions that would not add value to the people but instead rob them of the little they possess. If ever Bill Gates has a soul,it must be a juke box that only accepts pennies and cents from the poor of Africa to his account.Payback for his help with HIV and Malaria initiatives?
I just hope they seek redemption and stop being on the wrong side of history because you cannot achieve universal health coverage through private health service provision.
Ever since the announcement of Big 4 for rejuvenation of the
economy was announced by the President, I wondered who had the vision to come up with the four and package them in such a way
that it would look like a goal worth pursuing and saving grace for the
administration in need of a legacy. Going back to several investment overtures
by the above entity, I wonder are we being taken for a ride by a plot hatched
to market their investments? Is it a fait accompli or do we have a possible remedy?
I wonder, does the IFC have such a good
a soothsayer who could predict that we would be having a focus on their key
areas of investment in 2018? In as much as I have my opinion on the matter of
foreign investment in key sectors of the economy, I can’t begrudge anyone in need
of investment and finding the perfect opportunity in Kenya. The land of
opportunity for some and the land of suffering for others.
At the onset of writing this, I
thought IFC is not much involved in Kenya. I guess I was wrong. The IFC has
been continuously scaling up its operations in Kenya through equity or debt
financing to budding ventures. However its in recent past that the investments
seem to have increased to the point I just have to mull it and wonder what it
all means.
There are areas of investment
that they have decided to focus on that are almost carbon copy of the Big Four
plans. Be the judge and tell me if it’s just coincidence or it’s a planned
takeover of the Kenyan economy. (In Case the Chinese don’t buy us first).
Manufacturing:
Most of the efforts mentioned in
fulfilling the manufacturing agenda of the president’s legacy requires funding
for capital investment. The IFC has already imprinted its presence in several
local companies. Now for the SMEs and other new entrants there will be a need
for loans, which will definitely be offered by those invested areas of which
the invested company would benefit most.
Moreover IFC acquired 5% of
Mortgage firm Housing Finance with its acquisition of a stake of Britam. Britam
already holds 48.8% of Housing Finance shareholding. The article below also
notes other forays by IFC including loans to Equity (to be used to loan to
SMEs) and KCB and other investments and credit facilities in the country.
IFC has also put LaFarge in the loop to advance loans for "low-cost housing" developers for using Lafarge products for every unit.Quite a noble and altruistic motive I presume?
I don’t need to point out the
various investments in healthcare
that IFC has already completed before the call for Universal healthcare. The
most recent press reporting on the issue is the article below and other writings
including the earlier one I wrote in 2017.
If reaping from the middle class was not enough,the IFC also targets what they call impact investing in low-income earners.They have given $4.5million to Medical Credit Fund to scale up SMEa in healthcare targeting poor people.
The investments aim at increasing the access to healthcare but seems to be misdirected.Universal health coverage cannot be attained through proliferation of private providers.
Food Security and nutrition:
Since the fourth pillar of the
plan involves food security and nutrition, trust that there has to be an
investment opportunity in starvation. The IFC has scaled up the collection of proceeds from relief operations in conflict and famine ravaged areas by acquiring a stake in it. It invested in Insta
products, a company that provides therapeutic foods for malnutrition in conflict
zones. Some of the users of the products are UNICEF and World Food Program.
In other food security related coincidence,just as the president is starting the Big four initiative which includes it,open field trials for GMO maize have been completed and you shouldnt be suprised to see them being issued out to farmers by the next planting season.
And just on cue a KTN piece on GMO and its need bearing in mind diminished harvests.
Leading GMO advocates in Kenya have been the giant Monsanto and ironically the "philanthropist" Bill Gates foundation.Its worth noting Bill Gates holds $23.1 million worth of Monsanto shares.(Not that it counts as much to him).
Since the greater Rift Valley are all in government this time,there will be no objection to passing of GMO act to allow its availability to a seed depot soon.
As for fertilizers,IFC has given a loan to Nakuru based plant.
Did I mention that the VP of IFC for Middle East and Africa
Mr Sergio Pimenta was in the country in January 2018 and met the President at
State House.In their meeting some of the ways the private sector could help the
government were discussed.
So, I wonder am I the one missing the point or was IFC on
to us and are just getting ready to start scooping all the tenders through
their proxy firms which they have invested in ? Only time will tell.
Broadly speaking IFc has its toes in all the waters of the land and not a bird that flies or plane is not touched by its impact.IFC owns 10% of Kenya Airways now.Even Tullow oil has a 5% investment from IFC. IFC Invests Shs 5 billion in Turkana Oil
and other investments are with KTDA and other players.
I wish to point out that in all this the modus operandi of IFC is to issue loans and equity to fims and they just seat back and reap the profits while you toil.This is the Shylock syndrome that does not benefit anyone the most except the IFC.
In fact IFC has ensure it has its footprint in most commercial banks such that any loan you might take for a business venture today isnt coming from your bank but IFC.Since in most of the arrangements they are not equity for the bank,it only implies a financing mechanism with their cut assured.
As
a conclusion we need to understand that IFC is dipping its toes into
every venture that looks in the least bit lucrative and I wonder if they
are ones setting the agenda or just that they have good clairvoyance.
