State beware; monopoly threatens national security

The recent death of Wilfred Murungi, the founder of Mastermind Tobacco, elicited a lot of interest, especially with the low-key private ceremony that was his burial.

Many Kenyans, used to burials being huge events — the more renowned the person, the more flamboyant the funeral — were shocked that Murungi chose a quiet, private burial.

Mr Murungi lived his life as he wished, ignoring the peer pressure and conventions that affect most of us. And he ended it in similar fashion, eschewing our new burial traditions that we have adopted almost thoughtlessly. Ironically, “dignitaries” who made a career from conforming and pushing the status quo — sometimes illegally and irregularly — were prominent at his memorial service.  

Murungi deserves our admiration, for it is easier to follow the pack than not, no matter the expectations; much in the same way we must admire the late Binyavanga Wainaina who left a massive and positive impression on our lives and our society.

One of the more interesting parts of Murungi’s life was his fight against the monopoly BAT. Ignore, for a second, the harm that the tobacco industry has wrought across the world, leading to death, addictions and illness. Mastermind Tobacco was one of the few instances where established and protected monopolies have been challenged in the marketplace. That it took Murungi trials, tribulations and harassment to compete with BAT Kenya says a lot about the weaknesses of the policy frameworks in Kenya. 

There are few things as damaging to a country’s economy, our body politic and even national security in some instances, as monopolies, or quasi-monopolies. Which is why sensible states create independent and effective Monopolies Commissions to ensure that no one company ever dominates or controls the market — even if it is the result of creativity, ingenuity and hard work.

Those of us old enough to remember the one-party monopolistic state that was Kenya from the 1960s through to the 1990s, can attest to the debilitating, humiliating and disastrous consequences of monopolistic politics.

Sadly, the introduction of multipartyism in 1991 did not quite end the culture of monopoly politics. It shifted to a quasi-monopolistic state that pre-determined election results, while using police in the service of the ruling party and looting of tax-payers resources to facilitate patronage and control.

These monopolistic tendencies and bad habits of the ruling clique have not been cast aside. Blatantly unconstitutional edicts and directives are issued, and the police are still a tool for intimidation and killing. Looting has spiked, maintaining the country as an effective monopoly. The logic of economic monopoliesis the same as that of political monopolies. Yes, they can sometimes appear efficient and cheaper — much like the false allure of a dictatorship for efficiency, but only if it is in your favour. Our politicians demand democracy and choice when they are not at the table.

The biggest worry when it comes to market domination is in the telecommunication and dairy industries where Safaricom and Brookside can paralyse Kenya or make our lives miserable if they so wished. We can’t begrudge these companies their successes, but imagine if Safaricom’s M-Pesa went down for a week due to “technical problems”?

Kenya Breweries Ltd (KBL) was a monopoly for decades in Kenya and a powerful one too. They appeased us with their work with football and sports, but it was incredible that a beer drinking country like this was served by only one company. South African Breweries tried to take on KBL but failed miserably. We should take our hats off to Keroche Breweries who have been taken around the wringer in their effort to compete. They are holding on tight, and was the first to introduce sugar free beer.

But it should not be left to individuals and companies to tackle market domination. The state should play a significant role, as the US government did in breaking down AT&T in the 1970s and 1980s and what the EU is currently doing with Google, Amazon and Apple. It is simple really: it is a matter of national security that no one company wields so much power.

Which is why the claim by our Monopolies Board that there is no dominance in the dairy market, factoring in the informal market, is laughable and dangerous. Monopolies Commission are set up for formal markets.

But we can all play our own small part by always supporting the underdog in economic or political matters.

The writer is former KNCHR chair. mkiai2000@yahoo.com