Amid Hardship and Gloom, Innovation and Personal Triumphs

Even with the average long, and heavy El nino like short rains, it was the harshest, toughest year in a decade.  But regime hacks, as is their job, have found a novel way to spin it. The economy was treated to shock therapy, they write, as though it is a good thing. Stuff of spy movies, electric shock is a brutal method of torture. 

Thought as more humane than hanging, electrocution was introduced about a century and half ago as a method of execution of those condemned to death.  When the 2,000 volts jolt is applied, the body jerks upright and practically fries. Not all the condemned die at the first jolt, and the doctors in attendance have to wait for the body to cool in order to check if the heart is still beating. And if it is, another jolt! Macabre stuff.

Shock therapy for the economy is therefore, quite inappropriate.  And it kills all the same.  Only this time, the condemned are businesses.  One of my favorite small businesses is youth focused and in the communications sector.  Many years profitable, it had to lay off ten people in the last six months.  Many business owners were horrified at being negatively reported in the credit reference bureau data bases. Not even the assurances by the Central Bank that lenders are now using risk-based pricing could lessen the angst.  One business owner told me she was glad the year was finally over.  2024 will likely be worse, I thought to myself.  But I did not want to spoil her holiday cheer, so I kept mum.

Still, the human experience is not one sided. Amid the gloom and economic hardships, there was the occasional smile.  Call it looking at the sunny side of life, but here are some of the moments and events that made me smile in the course of the year.

Ever the source of pride and inspiration, Kenyan athletes did not disappoint. Three gold, three silver and four bronze medals in Budapest at the world athletic championships in August, just for starters.  And the marathoners won in Berlin, in Athens, in New York and in Chicago. They all make our nation proud.

This year, and for the first time, member deposits in saccos exceeded one trillion shillings.  I found this milestone uplifting not only for my love of numbers. Mid-year at Ufungamano, grassroots leaders had pressed me to suggest ways for Kenyans to cope with high interest rates and cost of living, I suggested they might retreat into their saccos!

Some analysts were surprised, that Kenyans were saving during such tough times.  Indeed, by August, nonperforming loans in the banking sector had hit 15% of gross loans, the highest level in 18 years.  And that was before the latest round of interest rate hikes. My own conclusion is that this is the resilience and innovativeness of Kenyans, great qualities, to be admired.  By growing sacco deposits they can avail themselves affordable credit, a rarity in the financial sector today.

Businesses continued to innovate.  A notable one that I came across is SMECAA – the small and medium enterprise credit access application.  Quite a mouthful for a tech platform. But by assisting small business to prepare credible financial statements, get a credit rating and generally manage the businesses better, it is a very useful tool indeed. Being cloud based, there is no need for heavy investment in hardware. Integrated with point of sale devises, it seems to solve one of the biggest hurdles in SME access to finance – information asymmetry. Oh don’t’ worry, it is just big English to say that you know more about your business than your bank.

There are a number of technology platforms that promise solutions to cross border payment difficulties on the continent. These difficulties arise because currencies are not fully convertible, forcing the use hard currencies such as the US dollar. And with all African currencies losing ground against the dollar, reducing reliance on the green buck has never been more urgent.  One platform that markets will take a keen look is Real Sources. Not only is it a trading platform – that is linking buyers and sellers, it uses commodity trade to achieve cross border settlements. Quite the clever, modern day, technology-based system of batter trade, you might say.

In Laikipia, Nanyuki High continued to be one of the most sought-after public high schools in Kenya, judging by the number of students who selected to join it, this and the last few years. It is nice to see that some of our institutions are working as they should be.

On a more personal note, the Homabay revenue growth story brought a smile to my face, not least because a number of folks commenting on social media, attributed some of the success to advisory work that I was doing for Her Excellency Governor Wanga.  In reality, it is her great leadership that brought the rapid improvement. 

As the year wore on, a catchy tune by Sofia Nzau – Mwaki – quickly caught on. Ever humorous, Kenyans begun signing it as a taunt to the regime on account of high taxes and tough economic times.

The rains broke the four-year drought. Earth dams have re-charged to last a couple of seasons.  This is a big deal for us in Laikipia and other counties in the Amaya Triangle. Livestock is key to our economies. Sadly, further north, the El nino rains have caused flooding and with it, loss of life.

At the end of September, our family friends Amina and Somo, amid a great community feast, floated the Somina, a thirty foot, three-ton Mozambique style dhow, at Mandalay beach.  Hand crafted over fifteen months, this labor of love can sail to Zanzibar from Lamu. Heated to the right temperature, the teakwood is curved to perfection. Amazing craftsmanship.

Perhaps Reagan was right after all.  Government is not the solution. Government is the problem.  Have a prosperous new year.

@NdirituMuriithi is an economist

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Lawrence Baraza

Lawrence Baraza is a dynamic journalist currently overseeing content at Metropol TV Digital. With a keen focus on business news and analytics, Lawrence guides the platform in delivering insightful, data-driven content that empowers its audience to make informed decisions. Lawrence’s commitment to quality and his ability to anticipate market trends make him a key figure in the digital media landscape. His work continues to shape the way business news is consumed, making a significant impact in the field.

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