Friday, December 14, 2007

Kenya Predictions Reviewed

In November 2006, I wrote some predictions in the Business Post December 2006/January 2007 issue, in which I put forward ideas, expectations, and wishful thinking for the country in year 2007.

Here’s a review of some of the Nostradamus-like thoughts:

Hit: happened Miss: did not happen Whiff: almost did, or unclear and narrative

- Processors launch new coffee and tea brands targeting the export marketHit Sasini, KTDA launched brands
- Sugar, maize, and wheat importation raises controversy Hit sugar a no brainer, while maize buying from farmers is delayed owing to imported maize in the silos
- Kenya Meat Commission revival stalls whiff off to a good start but Budget ’08 will show if it still needs government support
- Coffee smuggling once again becomes money minter. miss

- A correction in the stock market and equities go into bear mode. Hit
- The local currency strengthens, holding at KSh 60 to the US dollar for the better part of the year.Hit shilling kept getting stronger through the election year against most expectations and hit 61 from 73 a year ago
- Revolutionary money transfer/online banking for Kenyans in the Diaspora. Whiff Safaricom M-Pesa is a local hit, and is being tested international by Vodafone
- Several shareholder groups are formed to revolt against perceived insider trading Whiff though several watchdogs started barking after Francis Thuo collapsed
- Taxpayer groups agitate for better services from the government and presidential candidates. whiff only presidential candidates were put to task over their plans
- Entry of three new mid-size banks precipitates the merger of several smaller banks Miss only one merger, but banks realize that the capital stakes have been raised now
- More banks become stockbrokers Miss Only NIC (and Renaissance Capital) who bought into existing stockbrokers
- The dividend tax is increased while a proposed capital gains tax on shares is defeated. Miss a cap gains tax on real estate was shot down in parliament – one of their few good deeds this year
- VAT is reduced from 16% to 12%. Miss tax reduction is a no go subject
- Executive shuffles in blue chip companies. miss
- Co-operative Bank is listed on the Nairobi Stock Exchange Miss
- Celtel rushes the NSE Missin fact they exited the bond market
Safaricom IPO opens just before the elections. Whiff ???

- Free primary education continues to be a shining success Hit all candidates have promised free secondary as well
- Three new universities start offering degree courses. Hit more than three got licensed in the booming higher education sector
- Teachers again draw the government into a salary dispute miss election year government paid them their dues
- JKUAT opts for a new name to reflect its entrepreneurship and technology brand. miss but it should happen right?...

- Rivers dry up and Mt. Kenya and Kilimanjaro lose their snow peaks. Miss but ….
- Torrential rains cause mudslides, flooding, and destruction of infrastructure Hit
- A mandatory tree planting policy is reintroduced miss

- Nairobi hosts peace talks on Congo, Somalia, and Sudan. Whiff talks were held in other countries
- Uganda and Rwanda formally complain about infrastructure and bureaucratic delays in Kenya. Whiff only Museveni complained informally
- The US announces the withdrawal of troops from Iraq. Miss

HEALTH: Minister Ngilu’s social medical scheme is revived. Miss though she was fired and now promised that an ODM government will reintroduce it
ENERGY: Significant oil deposits are found in Kenya Miss If Total Man didn’t find oil, is there any?

- A second national operator starts operations with a focus on mobile and fixed wireless services in urban areas. Hit France Telkom also gets a wireless license which will be a big part of their offerings
- Work on EASSY submarine cable starts after Kenya gets its way on issues WhiffKenya building her own cable
- Econet finally launches, but there are doubts about its success. Miss shareholder disputes resolved, but no launch
- A project to computerize land title deed registration is launched. misse-government is still only on paper

- Insecurity rises partly because of heightened political activityHit
- Judicial reforms and reformers are in the spotlight Miss
- Kenya gets a female Attorney General. Miss AG entrenched after 17 years in office
- Wealth declarations are leaked Miss though one presidential candidate has release his voluntarily
- Tom Cholmodley Delamere is acquitted. Miss

- Local government under pressure to make it easier for business’ to operate but councils oppose proposals to scrap some licenses. Hit
- The government, recognizing the informal businesses and introduces new licenses, taxes, and building standards for kiosks. Missthough they built markets for ‘hawkers’ and will collect fees
- Nairobi City Council calls for the annexation of Nairobi National Park for urban development and settlement. Missbut the park is not safe

- Few laws passed as election fever sets in. Hit
- Parliamentarians initiate internal reforms and promise to work harder and for longer hours. Miss wishful thinking

- Trade with China dramatically increases. Hitthough imports in and investment into Kenya rise much faster than exports
- Kenya records the largest number of tourists in a decade. Hit
- New outsourcing companies are set up. whiff

- Rift Valley Railways operations off to a slow start. Hit companies are complaining, but it’s a Herculean task to revive the railways
- Mbagathi Way is opened. whiffroad in use, but incomplete
- Matatu owners sign a safe-driving pledge with the police commissioner. Miss wishful thinking
- A pothole causes a major road accident, reminding the nation of the cost of bad roads and the need to speed up road repairs.Missthankfully

- The Mombasa cross-country is a well-managed event, while an equally successful Safari rally is organized as part of the African series, securing the Kenyan event world rally status thereafter.Hitcross country was an internal success thanks to Kenenisa Bekele, but Kenya is not back on the WRC map
- Michael Schumacher resumes racing by joining a minor Formula 1 team in the middle of the 2007 season Miss but he resumed testing for Ferrari and racing in taxi’s
- FIFA promises to have some group games of the 2010 World Cup played In Nairobi Miss

- Government borrowing remains stable owing to consistent tax collection and reduced corruption. Hitbut borrowing is creeping upwards
- The public & private sectors hold a forum to agree on a formula for measuring the rate of economic growth. whiff only debate is between political opponents
- The role of donor aid comes under scrutiny as activists question their legitimacy as Kenya’s development partners. whiffonly debate is between political opponents
- A public watchdog heavily censures the expensive lifestyles of NGO bosses., while other crusaders call for Rwanda-style cutbacks on public expenditure especially the use of high cost 4-wheel-drive vehicles by civil servants. Missonly Maina Kiai is at work

- Kenya endorses a new low-cost housing design of KSh73, 000 ($1,000). Missdevelopments confined to high end housing
- A foreign bank takes over Housing FinanceMissthough local upstart Equity Bank buys 25%
- Water, sewerage, and electricity crises hits NairobiMissthough electricity prices will go up next year as electricity reserves get dangerously low

- Presidential and parliamentary aspirants range from chief executives to religious leaders and people famed only for their notorietyHit
- Several high profile leaders defect from their political parties, which they perceive as “unelectable”.HitTuju staying strong
- A number of opinion polls, some dubious, are launched but Steadman remains the most accurate forecaster of political events. Hitbut even Steadman is feeling the heat
- One-half of the Artur “brothers” resurfaces in West Africa. Whifflurking in Sri Lanka
- The vice president’s office is expanded assuming greater significance Miss VP often overshadowed by the Justice Minister
- Some forward thinking banks start to finance viable c a n d i d a t e s Miss
- The country holds peaceful general elections. whiff
- True to Kenya’s historical trends, the incumbent carries the day whiff
- A majority of ministers and MP’s lose to savvy challengers looking like a hit


DER said...

Hi Bankelele, any new predictions on Equity Bank. They seem to have a lot of political good will at the moment as evidence by the article in BDafrica: 'Kimunya hands Equity nine-year deal to keep real owners a secret'

will their growth continue with a new regime?


bankelele said...

Der: The ediotrial in B.Daily is shocking in it's anti-Equity position - as the Nation Media Group has always been one of the bank's greatest supporters(where their CEO is a director)

I previously wrote about Equity using their political muscle with the govenment to get all manner of approvals in record time, which other banks grumble often take many months to consider in their cases e.g capital issues, new branches

Ssembonge said...

Banks, History has an uncanny way of repeating itself.

Equity reminds me of a one Andrew Ngumba and his so called Rural & Urban Credit Finance.

DER said...

Thanks for the link.
One thing I know with banking secrecy is that in the long run someone gets hurt. Just saw a documentary on Colombian drug money making its way into African countries for the purpose of Laundering. In my opinion (new) Private Equity entities are ideal vehicles for this because you can convolute the ownership structures using networks of holding companies(The US war on terror has brought undue attention to traditional methods of money laundering), not to mention some of the questionable techniques some private equity funds use to get back their investment and returns.But equity bank has done quite a bit to make banking accessible to all but......I just get the sense that hiding the identity of bank owners is dangerous;In the long run, it never ends well for the little people. By the way all the above is conjecture and speculation from a personal view. But the equity bank exemption(s) make me nervous. Like someone once said, 'People who have nothing to hide.....hide nothing.'

I hope my gut feeling is wrong on this.


tumwijuke said...

Kenya's first female Attorney General? Is that even a prediction? To predict it is like chasing a mirage.

Very interesting and insightful post. I am so going to rip off some of the ideas (with some credit to you, but not much. ;-)


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