AfDB cautions Kenya over ‘growth for the rich only’

Samburu County Kenya Red Cross Society Co-ordinator Mugambi Gitonga hands over relief food to residents in Arisim village in Baragoi, recently.

NAIROBI, KENYA: African Development Bank (AfDB) has warned against Kenya’s growth that makes a few richer while majority struggle to survive. The bank says the country risks sinking into a fragile state that is highly vulnerable to shocks when only a few benefit from the growth.

AfDB says although Kenya has experienced economic expansion over the last decade, the growth has not been sufficiently inclusive rendering the economy susceptible to both internal and external shocks.

This, the bank says is evidenced by persistent high levels of poverty and regional disparities, limited access to basic services, inequality and unemployment, with the youth, women and other vulnerable groups particularly hard-hit. The bank through its country strategy paper (2014-2018) for Kenya reckons that lack of inclusion is mainly attributed to skewed distribution of income and property.

AfDB says other causes include past resource allocation policies which intermittently neglected certain regions and the concentration of productive economic activity within a small formal sector employing relatively small numbers of people but accounting for large economic returns and incomes.

“Therefore, pro-poor growth strategies and pro-active labour market policies, such as skills development for the youth, and increased participation of women in productive activities and decision-making processes, are required to make growth more inclusive and effectively fight poverty,” the bank says. “With the devolution process, resource allocation has been reorganised, which is expected to tackle the marginalisation of certain regions in the past.”

OVERALL STABILITY

AfDB notes that while it does not classify Kenya as a ‘Fragile State’, the country exhibits some fragile characteristics most importantly the high level of poverty and regional disparities as well as high youth unemployment, ‘which, if not effectively addressed, might pose threats to the country’s overall stability’.

The bank, however, notes that Kenya has made considerable progress in recent years towards a politically stable, democratic country with the enactment of the new constitution in August 2010, conclusion of a peaceful political transition following the March 2013 elections, and the launch of a devolved system of governance in the same month.

“Therefore, pro-poor growth strategies and pro-active labour market policies, such as skills development for the youth, and increased participation of women in productive activities and decision making processes, are required to make growth more inclusive and effectively fight poverty,” says AfDB.