In the bustling centre of Nairobi, Kenya’s capital, a statue stands tall, commanding attention and emitting an aura of determination. With a gaze full of resolve and his right hand resting firmly on a rifle, the iconic freedom fighter Dedan Kimathi is immortalized in bronze, a poignant reminder of Kenya’s struggle for independence.
Dedan Kimathi’s statue is a prominent fixture for anyone navigating the heart of Nairobi. As pedestrians traverse through the city centre, this commanding figure serves as a tangible link to Kenya’s history and its arduous fight against British colonization. Kimathi, a symbol of resistance and resilience, represents the collective spirit that fuelled the nation’s quest for freedom. The significance of Kenya’s journey to independence is encapsulated in the date December 12, 1963, forever etched in the nation’s history as Jamhuri Day.
60 years on, President William Ruto in Nairobi at a public ceremony marking 60 years of independence from the British colony declared that Kenya is “out of the danger of over-in- debtedness”, praising his economic policy despite public anger at tax hikes and subsidy cuts.
“We have made the right choices, sometimes taking very difficult and painful decisions, to steer Kenya away from the brink of a catastrophic abyss of over-indebtedness and set our country on a new course.” – President William Ruto
President Ruto gave no figures on the current level of public debt, but pointed out that gross domestic product (GDP) had grown by 5.4% over the past six months. But the question is that has the 60 years of freedom spelt economic independence to the East African country?
The Kenyan economy was severely shaken by Covid, followed by the shockwaves of war in Ukraine and a historic drought in the Horn of Africa, resulting in empty coffers, gal- loping inflation and a plunging currency. At the end of June, the country’s public debt stood at over 10,100 billion shillings (64.4 bil- lion euros), according to Treasury figures, or around two-thirds of gross domestic product.
The cost of servicing public debt has risen sharply with the collapse of the Kenyan currency. And in June 2024, Kenya must also repay $2billion in Eurobonds.
Kenya In Search of Harmony 60 Years After Independence
As Kenya commemorates 60 years of independence, the prevailing sentiment is far from jubilation for everyone. Reflecting on Kenya’s 60years journey and the present situation, Berline Ndolo, founder and program manager of the World Network for Sustainable Change, a non-governmental organization based in Kisumu, Western Kenya, paints a stark reality of Western Kenya as “the poorest of the poor.”
According to Ndolo, for many in this region, Jamhuri Day, the nation’s Independence Day, is not a cause for celebration. The high cost of living has created an environment where the basic necessity of three meals a day is a luxury and out of reach. Ndolo reflects, “They’ll focus on how best they can feed their family with their very few resources.”
The phrase “high cost of living” echoes across Kenya, casting a shadow on the anniversary cele- brations. President William Ruto, having completed one year in of- fice, has implemented austerity measures, cutting subsidies, and introducing new taxes. Unfortunately, these measures seem to have exacerbated the challenges faced by ordinary citizens.
Ndolo, moreover, acknowledges the initial optimism surrounding President Ruto’s agenda, with vot- ers harboring hopes for positive change. However, the stark reality contradicts these expectations.
“If anything, businesses are closing, employed individuals are burdened with heavy taxes, and still, we’re struggling to make ends meet.”– Berline Ndolo, founder and program manager of the World Network for Sustainable Change.
The economic hardships faced by Kenyans underscore a widening gap between promises made and the lived experiences of the population. The impact of reduced subsidies and in- creased taxes is palpable, particularly for those already grappling with the burden of a challenging economic environment.
President Defends Painful Economic Measures
Since his election in August 2022, President William Ruto has steered Kenya through a series of economic changes, including the introduction of new taxes, a reduction in subsidies, and a de- fence of high taxes to address the country’s foreign debt, which has ballooned to $70 billion.
In a move that contradicted his campaign promises, President Ruto introduced new taxes, sparking organized opposition protests between March and July, resulting in unfortunate casual- ties. These measures included the reduction of subsidies, particularly on petrol, as part of a strategic shift towards prioritizing production over consumption.
Defending these decisions during celebrations marking 60 years of Kenya’s independence, Pres- ident Ruto characterized the imposed taxes as a “necessary sacrifice” to manage the growing foreign debt. He assured the nation that the economic reforms initiated since his government took office in September had pulled Kenya out of the danger of debt distress, placing the economy on a stable footing.
The economy has become a focal point in Kenyan politics and daily life, especially as the government grapples with mounting debts, including a $2 billion Eurobond due in June. To bolster foreign ex- change reserves, the government secured a $938 million lending agreement with the Internation- al Monetary Fund last month. Not all reform attempts have been successful, as evidenced by the court’s rejection of the mandatory housing levy, deemed discriminatory and against the constitution. The removal of subsidies on fuel and maize flour, essential commodities in Kenya, has also contributed to the economic debate.
Ruto Presidency Now Being Scrutinized Harshly
The economic setting in Kenya is undergoing a paradigmatic shift, triggering a thorough scrutiny of President William Ruto’s policies, according to James Shikwati, founder of the Inter Region Eco- nomic Network. Interestingly, this scrutiny is not driven by ethnic considerations but rather a focus on the economy’s performance.
“People are losing their jobs, companies are closing down,” Shikwati noted, emphasizing that the evaluation is centred on economic indicators rather than tribal affiliations. As Ruto’s policies led to price hikes, public discontent manifested in widespread protests, orchestrated by Raila Odinga, a former Kenyan Prime Minister who contested the 2022 presidential election results.
The economic challenges reverberate through various sectors, impacting both small businesses and workers who rely on tour- ism-related activities for their livelihoods. As the economic scrutiny intensifies, the focus remains on how President Ruto’s policies will shape Kenya’s economic trajectory and whether the promised sta- bility and progress will materialize in the face of ongoing challenges.
Big Projects And Spiralling Debt
As Kenya celebrates its 60th Jamhuri Day at Uhuru Park, the site of historic democratization strug- gles in the 1990s, the shadow of massive infrastructure projects looms large. The Nairobi Express- way, a stilt-supported arterial road linking the city centre with the airport and rail terminals, stands as a testament to Kenya’s ambitious initiatives. Paired with the railway connecting Nairobi to Mombasa, these projects, while boasting impressive connectivity, come at a hefty cost.
Economist Shikwati points to the significant financial burden these projects place on the country, contributing to the economic challenges faced by Kenyans to- day. The roots of these endeavors can be traced back to the after- math of the 2007 post-electoral crisis. Facing charges at the International Criminal Court, both William Ruto and Uhuru Kenyatta joined forces for the 2012 presidential election, framing their collaboration as a response to what they deemed “colonial” justice.
The urgency to endear them- selves to the Kenyan populace drove a commitment to show- case success, manifesting in grand infrastructure projects. The Standard Gauge Railway, inaugurated in 2017, and the Nairobi Expressway, opened just last year, are key components of this narrative. According to Shikwati, the push for success was fuelled by a time constraint, with a five-year window before the next election campaign.
Economic Hardship Challenging Kenya’s Future
One of the most palpable consequences of Kenya’s economic challenges is the soaring cost of living. The introduction of new taxes, reduction of subsidies, and the impact of global economic shifts have left many struggling to afford basic necessities. From skyrocketing prices of essential goods to job losses and business closures, the economic strain is acutely felt across the nation.
Expenditure on those unnecessary projects were the beginning of a spiral of loans and a rapidly growing mountain of debt. According to Shikwati, bias in the global financial system and misjudgements by the World Bank and the International Monetary Fund also played their part.
But Ruto’s decisions as President, whether ending subsidies and introducing new taxes, certainly did not make the fiscal crisis better. “Our economy is more or less like what we in Kenya call hawkers — the people who carry things and sell on the street. So I would say it’s like a hawking economy. You buy things from China, you sell to Kenyans,” explained Shikwati.
Following that logic, imposing high taxes on an economy that was not productive, left few options– to reduce activities and close down companies, putting even more strain on the population.
It turns out that 60 years after independence, the fight for freedom is no longer the de- fining factor of Kenyan society. Now, it’s economic hardship that’s challenging the country’s future. Despite the President declaring that the country is no longer in debt distress, economic hardship lingers on.