Counties told to be serious with regional bloc concept

The 14 counties that form the Lake Region Economic (LREB), have been urged not waver on the much-hyped region’s bloc idea.

The bloc’s Chairman and Kakamega Governor Wycliffe Oparanya told member counties to increase their commitment and resources toward LREB joint activities.

“Our trading blocs is one of the best avenues we can use to achieve sustained development and increase our participation in the domestic, regional and global economy,” Oparanya said.

The county boss urged devolved units to re-evaluate the interrelationship between trading bloc partners and the regional economic growth. Mr Oparanya noted that the LREB was hinged on fighting poverty and boosting the income of bloc’s members

This came amid reports by Deloitte East Africa counties bordering Lake Victoria are at the apex of the poverty index in Kenya.

The recent study entitled ‘Lake Victoria Basin Economic Blueprint’ noted that the long-term economic transformation of the Lake Basin region depends on the extent to which the counties and their leaders to develop and implement a shared vision for regional transformation and development.

Sufficient capital

Oparanya asked the LREB member counties to be serious with the economic bloc. He spoke as plans to buy the majority stake from an existing bank and open the proposed Sh2.6 billion LREB bank flopped in 2018 as scheduled.

Even as Oparanya said the plan to set up a bank was on course, the bloc failed to raise sufficient capital in good time. “The LREB Bank idea has not died,” he noted.

“Some people think we have abandoned the idea, No. The plan is still on course, it only delayed because some member counties had not fully paid as anticipated.”

The bank’s plan has now been pushed to March or April 2019 to allow the 14 member counties that have not committed their budget towards the bank’s project to do so. LREB Chief Executive Abala Wanga said the bloc was not able to raise sufficient equity or share capital to buy majority stake in an existing lender. “We targeted to start operations by October this year. But by end of the month most counties had not fully paid up the Sh200 million toward the bank, so it wasn’t possible,” he explained.

Each of the 14 member counties were to contribute Sh200 million toward the proposed regional lender by way of shareholding.

So far, only about 10 counties had committed about Sh1.3 billion in their budgets.

Governor Oparanya and Wanga spoke as Migori County Assembly ratified the LREB Bill to formalise their operations at the bloc as is required by legal edict. Governor Okoth Obado backed the idea. Abala said LREB requires five counties to endorse the bloc’s operations.