JUA KALI, THE WEED KILLING KENYAN FORMAL ECONOMY

gaftr254At independence, Kenya was a fairly formal economy. Rules, standards and procedures were well formulated, articulated and judiciously implemented. Our police, just like all other civil servants executed their duties meticulously, zealously guarding the word and spirit of the law.

Our professionals; engineers, architects, doctors, pharmacists, lawyers were all sworn to their code of professional ethics. We had a working template of budding companies that respected their staff. Staff houses, buses, schools and clinics were common place. Public transport was a perfect example of order and our rail system was working. Everybody was sold to the straight and narrow. There was no otherwise.

 

Clouds gathering:

A story goes that immediately after independence, a group of elders approached our founding father for some favor. Apparently, the very high standards kept the pie out of reach of most citizens. At the time, public transport was under the Kenya Bus Service and KENATCO. These elders sought permission to operate individual public transport vehicles from industrial area-specifically Lunga Lunga to town. Permission was granted and therein, the Matatu culture was officially born in Kenya.

 

The rain started:

55a452ff2177c76348f83626fff18d29Henceforth, mediocrity and disorder became our second nature. We looked for, found or created shortcuts in every public undertaking to the chagrin of formal operators and the general public. For example, the newly sanctioned Matatu operators had no fixed routes, operated at their convenience mainly during peak hours and were not answerable to any authority on their fares and schedules.

They could withdraw their vehicles from the road anytime they so wished. This was unlike the KBS which had a contract with the City Council to maintain a minimum number of vehicles on the road daily with a fixed travel timetable and routes to service. They also had to start and end their operations within the agreed timelines.

Official Chaos:

Overnight, informal operators sprouted almost in every industry trampling upon the previous players and with it, the known formal standards plummeted to unbelievable levels. The new players were a mockery to investment and a ridicule to standards. Instead of entrepreneurs, we came up with a new one-tenderpreneurs, a polite word for officially sanctioned theft from the government.
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Expectedly, the formal operators with their strict adherence to standards and quality could not keep up with the predators. The public service, as we knew it crumbled. One by one, the formal players fell by the wayside. Sugar companies closed shop as sugar barons and uncontrolled imports took over.

The much derided private schools became the new darling. Public hospitals turned into death chambers as the once vibrant railways and KBS went to the dogs. Hawkers invaded the Central Business District.

Our professionals too were infiltrated by quacks. For a small fee, you could get anything from the authorities. Buildings collapsing, lawyers eating their client’s money, doctors procuring abortion at a fee, pharmacists dispensing poison and our honourables seeking treatment abroad became the new norm.

 

Sustained:

The onslaught on standards and procedures was sustained throughout the Moi regime. The police too soon realized the folly of fidelity to law as lawyers and judges had a party with criminals.

They too joined the bandwagon, brokering justice on the streets and pocketing their cut. The judiciary was up for sale. Unchecked imports by favored individuals took its toll on local manufacturing. KEBS went to the highest bidder and counterfeit took over our markets.

 

Grave yard supermarket:fb92f76f88d6f7704dece813c9e9e248

The multinationals, overwhelmed by the many rats nibbling at their market moved their production to friendlier nations. Our industrial area soon turned into an industrial grave yard and our Nation, one big supermarket for Chinese fakes.

One-man guitar:

Under this onslaught, our formal sector began to shrink and with it went formal jobs. Going it alone or one-man guitar became the rave. Even the government was at the forefront of urging our youth to self employ- the rallying call being “Jiajiri”. Everybody became a boss. A one-man Boss.barrow_jack_alltrade

The promoters of this one-man business were of the mistaken opinion that bigger companies would grow out of these outfits. It’s like expecting a rat to grow into an elephant. No amount of feeding, training or coaching or growth can turn a rat into an elephant. May be just an overfed rat.

That’s what we now have in Kenya. These Jua kali companies have only grown into bigger jua-kali companies and not transitioned into big corporates as envisioned.

These organizations have been weaned and fed in disorder. They grew because they were given loopholes. They have no respect for staff, systems and procedures and standards. They excel on patronage and connections and not on product or service quality.

They, for example do not pay formal taxes or keep proper books of accounts. Naturally, they do not need or respect qualified staff as all they need is an owner with the right connections.

 

The cost:

Our Jua Kali culture has killed decent jobs and with it, quality production. Our youth, do not have the orientation to create systems that can match the global standards of productivity. We cannot compete with organized labor and capital that is employed at the international arena. The efficiencies and economies of scale are simply unmatched. A one-man guitar cannot compete with an orchestra.

 

The ruthless global future:

International competition is right at our doorstep. We had time and chance to practice and better our game but we squandered it chasing easy money. It is foolhardy to imagine that we can export mediocrity to the global stage. Our Jua

SHANGHAI, CHINA - MAY 21: President of Russia Vladimir Putin and Chinese President Xi Jinping toast with vodka during a signing ceremony on May 21, 2014 in Shanghai, China. Russia and China signed a thirty-year contract for supply of gas. (Photo by Sasha Mordovets/Getty Images)

Kali or Matatu thinking cannot compete at the global stage.

If we cannot enforce our own local standards, someone from outside will. Look at what Uber, the international Taxi hailing app has done to our one-man taxi business. And that’s just a warning shot.

When our local football league proved to be useless, fans easily shifted to the English premier league. KFC is already here with global standards. Woe unto those who still slice up their potatoes with pangas! Carrefour just landed. A quality shop. No industry will be spared the global onslaught.

We have no choice than to think, work and produce like other global citizens. We need more of Safaricom and The Java Coffee Houses. Companies that understand that they are playing at the global stage and benchmark with the best. The one man-heroics will be history. What a price to pay for state nurtured mediocrity!

 

Evans Majeni is a businessman and a Director at AMM.

5 thoughts on “JUA KALI, THE WEED KILLING KENYAN FORMAL ECONOMY

  1. A most enlightened article. To make it worse, our universities have yet to figure out that some of the courses they offer will be replaced by computers in the next 5 years…leave alone 10. And many are still doing things the same way in a dynamic global stage. I never use the word luck but Kenya is going to need it.

  2. Nice piece with good command of queen’s languages, but lacks insightful thinking. It provided chronology of events but failed to point out what prevents our Jua Kali from being the corporations you admire. Think of how the Jua Kalis are revered in our neigboring country. I think it is a question of regulation rather than demonizing the one man guitar; in fact, all corporations begin with a one’s thought.

  3. I agree. However its foolhardy to say its state nurtured. The state is also a victim of the juakali activism and gung ho judiciary who have mutilated democracy and in essence created that culture. That you can go to court to prevent an investigation is not the beginning of the end… its the end…

  4. Very candid. The disaster called Jua Kali is such a blot to apprenticeship and innovation. A very dark chapter in our industrialisation and development. We must rethink it, drop, else we will find ourselves importing manufactured goods from Somalia

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