2024 will be the year of the US$2b Eurobond.
Much of what the Kenya Kwanza administration has done since taking office - especially with regard to tax and fee increases - has been geared towards ensuring that the country does not default on the debt it inherited from the previous administration. Ideally, it would be great if we avoided default.
One also hopes that the quest to avoid default is forcing us to learn important lessons about probity in Public Finance Management. Even though it might not feel so at the moment, the current moment's silver lining is the strengthening of the Kenyan fiscal state. The government is (at times very inefficiently) learning how to most effectively squeeze revenue from the economy.
As a result, more and more Kenyans are learning that they cannot exit public life - the Kenya Revenue Authority will come find them wherever they are. Hopefully, this will force us as a people to be more mindful of what the government does in our name, and the people we choose to lead the government.
For the Kenya Kwanza administration, one hopes that there is a plan to pivot to serious policymaking once the Eurobond payment is behind us. This will require a shift in the incentive structure governing the relationship between leading politicians and the government.
Presently, the standard operating procedure is that senior politicians and their supporters get direct monetary benefits through corruption proceeds. The country would benefit from an arrangement where the politically connected get compensated with favourable policy if they invest in job-creating and export-oriented businesses. Admittedly, the latter approach requires more work on the part of the wakubwa.
For example, they would not have as much time to dance on podiums or abuse each other at funerals. However, the upside for them is that it would earn them a lot more respectability both domestically and abroad.
There are a lot of low-hanging fruits in the economy where politically-connected individuals could reap big - from agriculture, to logistics, to light manufacturing, to trade facilitation. If we are going to have cronyism in the public sector - which at this point seems ineluctable - at least have it yield world-class businesses that create Kenyan jobs (as opposed to the standard theft and capital flight).
Happy New Year!
-The writer is an Associate Professor at Georgetown University
