Had nice week which started with an unplanned tour of snow capped crater on Mt. Kilimanjaro courtesy of a South African Airways pilot to a Yvonne Chaka Chaka concert , among other fun activities in South Africa.
My comfort is that if that if the Highway Africa / Digital Indaba conferences’ were held in Kenya, the delegates would be drawn from Ministers, MD’s, and other senior corporate and government officials, and not ordinary journalists or mere mortals like myself.
Kenya vs. SA
One of the sessions covered this week was the controversial EASSy project which appears to have been now reduced to a Kenyan vs. South African affair.
South Africa traces its history, not to 1994, but to 1957 when Ghana become the first African country to gain independence. South Africa identifies with that milestone and thus immerses itself as a being proudly African and wanting to take the continent forward together though NEPAD and the African Union (AU) as a way to better all African lives and be more competitive with other continents. EASSy is NEPAD’s flagship project which is intended to bring down the cost of communication for the whole of Southern, Central and Eastern Africa.
SA’s leaders are largely drawn from the freedom-struggle movement are proudly African and strive to combat Afro-pessimism in all at forms. In economic terms, they are disciples of Joseph Stiglitz, who are wary of foreign aid and other donor-championed programs such as privatization, having seen how devastating they have been to many other African countries over the last 50 years.
South Africa proudly champions African solutions to African problems e.g. through NEPAD. It also proudly champions media coverage of Africa by Africans, not western media agencies. The South African Broadcast Corporation (equivalent of KBC) has spent 8 million rand and sent a staff crew of 60 to cover the recent elections in the DRC and already has foreign bureaus in Africa, Middle East, US and Europe and soon to open new ones in the Caribbean and China. Such coverage of the continent is something Kenyans may find unsettling.
Kenyans on the other hand have seen the OAU, East African Community (EAC), Preferential Trade Area (PTA), COMESA and other regional groups come and go with little impact. They are used to having neighbouring countries who are basket cases mired in wars, famines, or other problems and are happy to offer assistance militarily, hosting peace talks, food wise, or hosting refugees. They are used to having to do things alone and the EASSy is just the latest example of this.
They view South Africa as new to the party, but eager to assume a super power role and both economically and strategically dominate the continent. Thus they revel in small victories like when Kenya Breweries defeated Castle Breweries (SA) in the beer wars of the early 2000’s, denying MTN a cell phone license, or frustrating any South African company that tries to take over Uchumi.
Likewise, ordinary South Africans see Kenyans as having a problem with them. When I told a MTN employee that South Africa's Telkom had been short listed to bid for the second national operator license in Kenya, she said Kenyans would never let a South African company win.
Also on Monday, the City Press a prominent black newspaper had two business headlines on Kenya titled Stock trading noise to end (referring to electronic trading on the NSE)and “Kenya credit rating hit by risk and corruption scandals” - an unfortunate spin on an otherwise positive assessment of Kenya by global markets.
9 comments:
Banks - Thanx for the info!
I found a stark division between 1st World & 3rd World. That said, there was substantial government involvement in attracting businesses to SA in both the federal & regional levels.
Each province had its own government thus they competed against each other. This has plusses & minuses & mirrors the USA in many ways.
I was amazed that they had currency controls in SA! Nevertheless, the Rans has real buying power in ALL nieghbouring countries thus SA citizens take Rands abroad instead of US$.
There is a huge sense of xenophobia esp for Kenyans but more so for Zimbabweans.
Kenyans will generally laud a local firm's victory over a foreign firm from the sidelines (even though Kenyans don't always buy Kenyan goods!) BUT that is common to most countries including SA.
Unless we know the intimate details about EASSY, it is difficult to assess the benefits of the project. I support the cable to Mid-East & India (extending to Far East) since that region is more important to Kenya than SA.
SA has a strong constitution & a government that is structurally a better democracy than Kenya (or other African countries) thus the "press" has more rights than Kenya's. I doubt the Standard would have been raided in SA.
kudri - let's share ideas!
How do I get in touch?
coldtusker: they are very pro-investor. They also recognize that their communications cost are among the highest in the world and are working to change that through open-source, broadband and other initiatives.
Kudrinketh: Thanks for the portfolio tips. Don't know much about real estate having only heard a few stories about "monied" kenyans with investments here.
That's a very interesting recap of the tension between the two countries.
I remember the Tusker wars very well, all the billboards and magazine ads - average Kenyans talking about how they were going to kick SA out of the Kenyan beer market. Great marketing on Tusker's part, and fun to remember.
Kudrinketh,
Keep those tips coming.
The Tusker wars! For u to enter Kenyan market, look for a franchise owned by Kenyan..the only successful company 4rm SA is Nu Metro theatres. I think there is one thing abt Kenyans on African products, most shun imports 4rm African countries. Look at retail chain Shoprite, it has controled retailed markets in most African countries right to our neighbour here Tanzania.. Will we see a the exit of the chain after Kenya's leading retail chain Nakumatt Holdings announced its expansion plan to East and Central African countries?
There a wrath of war btw Kenya's and SA companies. But the former might succeed considering its more developed.
Competition is good... I think NuMetro misread the Kenyan shopper who is price sensitive.
NuMetro used to source goods from SA & the strong Rand made SA goods uncompetitive. The local manufacturers enhanced their image thus recaptured a large part of the market e.g. Kenylon & Peptang.
The problem with SA firms is, they try to compete with local firms offering the same products but theirs are sourcing 4rm SA. Kenyan market is a hard nut to crack by SA companies unlike other African countries which they have dominated the markets. For the EASSY project, i also object to that... SA wanna control the communication system in the region hence it will make any difference on the price charges. Better Kenya lay its own system like the way it is doing laying fibre optic btw Mombasa and Malaba border. This will reduce the communication by more than 1000%.
I support Kenya, dont let other countries control our economy. By the way, our economy has been growing despite IMF and World Bank denying us AID.
Kenya should lay the fibre optic on its own. The government recently said it will lay a fibre optic cable connecting to the middle East. Thats a good idea, considering what happened in West Africa.
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