ONLY THE STREETS CAN SAVE KENYA
The meeting between Ruto & Gideon Moi was unexpected but not surprising. Politicians are always pursuing their interests, whether business or political. Anyone who thinks any politician is pursuing his or her interest needs their head examined.🧵 The reason why beating an incumbent is hard is because of the power, resources and influence they wield. These can be used to manipulate even their fiercest opponents.

Kenya’s Economy: 80% Informal, 100% Confusing. Where’s All This Money REALLY Coming From?

Many people struggle to understand the Kenyan economy because of confounding factors. These are factors that create analytical fog, leaving many questions unanswered. THREAD 🧵 People wonder why the economy remains functional despite years of mismanagement. The country looks like one big construction site despite years of difficulties and uncertainties. Where is all this money coming from, people ask.

The current political agitation in the country has its roots in the economy. The Kenyan economy is collapsing systematically after years of looting and mismanagement. If you think you have seen a lot, you ain't seen nothing yet.
THREAD 🧵 Those who say that the youths have no issues and are driven by petty politics are living in denial. Every year, we are releasing a million youths into a job market that is only creating 80,000 new formal jobs. In 2024, the informal economy created 90% of all new jobs.

If you think a lot about the proposals in this year's budget, you will lose your mind. The media focuses a lot on the Finance Bill. Yet the Bill is a derivative of the spending plan and that is where the real story is.
THREAD 🧵 The national government's recurrent spending is set at KSh 1.7 trillion. When you add the KSh 1.1 trillion for debt interest, you get KSh 2.8 trillion. Adding pensions and other CFS takes you to KSh 3 trillion.

The government has borrowed a new USD 1.5 billion Eurobond at an interest rate of 9.5%. USD 900 million from this new loan will be used to pay off a Eurobond issued in 2019. According to this press release issued in 2019, that Eurobond attracted an interest rate of 7%. 🧵
This regime keeps telling us about inherited debt, but now they are issuing more expensive debt. They inherited cheap debt and are replacing it with more expensive debt. Look at the attached interest rates for previously issued Eurobond.

When @WilliamsRuto took over power in September 2022, the total public debt stood at KSh 8.7 trillion. Today, it stands at KSh 11.1 trillion. In less than 30 months, he has borrowed a staggering KSh 2.4 trillion. 🧵 This is the fastest accumulation of public debt by any president in Kenya's history. In a similar period, Kibaki accumulated KSh 117 billion while Uhuru accumulated KSh 1.1 trillion.

From the time I started writing on the issue of reckless borrowing & its implications on the economy, there have been people accusing me of crying wolf, fearmongering, negativism & even alarmism. At one time we were called River Road economists & "sky is falling" brigade.🧵 Even today we still have naysayers who are asking when the much-hyped economic collapse will come. These are people blinded by political sycophancy and tribalism to see the obvious. They even downplay their own economic pain.

When I was younger, I used to hear of midlife crisis and would laugh off the concept. In retrospect, I feel that midlife crisis is real and should be taken seriously. Those in your 20s and 30s pay attention.
THREAD 🧵 Many of us thought that by the time we get to 40, we would have ticked all the boxes in life and looking forward to retiring in bliss. I thought at such an age I would be working for fun not funds. But life had other ideas.

We need to stop pretending that the implementation of CBC is going on well. It isn't! JSS students in public schools are hardly studying. The inadequacy in resources has rendered the implementation of CBC in public schools an impossible task.
THREAD 🚨 For instance, there aren't enough teachers to deliver the curriculum. The few JSS teachers are overworked and expected to perform miracles.

This is the statement of government's fiscal affairs for the first half of the financial year. The government spent the equivalent of 57% of tax revenues on debt expenditure (principal and interest).
THREAD 🚨 However, the amount budgeted to be spent on debt expenditure in the revised estimates is equivalent to 75% of tax revenues.

Only 15% of the development spending for the national government has been realised with 50% of the year gone.

The worst thing that poverty robs a person is not money. It is self confidence. Once your self esteem is drained, recovery becomes almost impossible. 🧵 Poverty thereafter becomes a self-perpetuating disaster. Even your children will lack confidence which will impair their progress in life.

The things which happen in Kenya's electricity sector can be very depressing. The other day, the Energy CS revealed that cheap hydropower from the Turkwel Hydropower plant has been replaced with expensive solar power from IPPs. 🧵 This is sickening as it is. But wait till you hear the explanation. Sometime back three solar power plants each with 40 MW power were set up in Eldoret. The transmission line which delivers the power from Turkwel couldn't handle both the solar and hydropower.

The ongoing demolitions in Athi River are barbaric and inhumane acts of economic sabotage. They irony is that they are directed by people who are seasoned and unmatched land-grabbers.
THREAD 🧵 While it is true that the contested land belongs to EAPC, there can be no justification to demolish people's houses without adequate notice to vacate. This is illegal. The hurried demolition was also done to deny the victims the right to appeal the ruling.

Those #DeadCapital stories about Luo and Kikuyu lifestyles are like two mad men arguing about who is more mad than the other. Building a home you don't use and having money in a bank while living in squalor are the same. Allow me to elucidate;
THREAD 🧵 These are psychological manifestations of childhood trauma induced by abject poverty. The guy who keeps money in bank while suffering is paranoid. He lives in daily fear of reverting to poverty. He is paralysed from spending.

A story is told of monkeys which used to invade a certain maize plantation. The monkeys really hated the farmer because he would chase them away and stop them from enjoying the maize.
THREAD 🧵 One day news reached the forest that the farmer had died. The monkeys broke into celebrations. At last the one who used to stop us from eating maize is no more.

Tanzanian inflation for the month of June has dropped to 3.6%. Yet some regime apologists claim high cost of living is a global thing!
THREAD 🧵 In 2019, I was in Dar es Salaam and one Kenya Shilling could get you 22 Tanzania Shillings. Today 1 KSh is equal to 17 TSh. The Kenya Shilling has depreciated significantly against regional currencies including the Uganda Shilling.

As discussed earlier, economies don't collapse in a day. Economic collapse is a long drawn out process. In this article, I have, described three phases of economic weakening. As you can see, even with all our problems, we are still not near the worst of places.
LONG THREAD 🧵 Our situation redeemable but time is not on our side.
Phase 1: Onset of Economic Crisis
i. Falling business profits as can be seen by performance of listed companies

The fears that Kenya can default on the USD 2 billion Eurobond maturing next year are somehow exaggerated. The government has many options of dealing with the issue.
THREAD 🧵 There is the current proposal to buy back the bonds from the secondary markets. This will reduce the bullet payment required next year and also save us from interest expenses.

The way this regime has politicised the economy will come back to bite them hard. While it is obvious Uhuru bears responsibility for a lot of the economic mess we are in, it doesn't make sense to dwell on that post election.
THREAD 🧵 Elections ended and the regime in charge is there to not only correct the mess but also leave the situation better. If they fail in that, the former regime will also politicise their failure.

I have been wrestling with the question as to whether a government can be voted out on the account of economic mismanagement.
A THREAD 🧵 This can happen in developed countries which practise more issue based politics. Such countries also have a large middle class which feels the pinch of economic mismanagement and therefore likely to be more politically aggressive about it.

The unprecedented and uncouth attack on @NationMediaGrp by trade CS @HonMoses_Kuria should be condemned by every Kenyan who loves this country.
A THREAD 🧵 The brothel inspired digital diarrhoea is unbecoming of a leader ranking so high in government.