Election timelines and activities 

Next upcoming significant event: Political Parties to submit party membership lists to the IEBC on April 9, 2022.

Significant political event of the week: What Azimio Promises to deliver to the Private Sector 

On March 2, 2022, the Kenya Private Sector Alliance hosted presidential hopeful and former Prime Minister Raila Odinga at a roundtable to discuss private sector priorities as part of the Mkenya Daima Initiative.

In his speech, Mr Raila emphasised that the focus of the Azimio government shall be to enhance MSME growth and increase their capacities to penetrate foreign markets to improve Kenya’s overall exports.

To this end, he outlined the following as the strategies to be employed:

1. Push the shift of having the agriculture sector move from exporting raw materials to exporting finished products.
2. Set up a body to monitor the trade agenda on exporting.
3. Join the private sector in planning; The government will organise monthly trade training meetings bringing onboard all key stakeholders.
4. Unveil an award scheme of the best exporter.
5. Support the private sector through tax breaks, government guarantees.
6. Ensuring business and trade are part of diplomacy in foreign markets. Diplomacy will have to be business minded.
7. Pay attention to MSMEs to tackle the challenges of unlocking foreign markets.
8. Enhance the Export Promotion Council.
9. Provide firms with political and economic intelligence to assist in exploiting new markets.
10. Provide a level playground for all firms to ensure that SMEs scale to big multinationals.
11. Invest in education and research.
12. Invest in knowledge and innovation economy that is; invest in the ICT sector to ensure the Kenyan demographic works in foreign markets.
13. Offer support / credit guarantees for businesses.
14. Maintain a constant and well-coordinated relationship between the Private Sector and Government.
15. Ensure there are enabling policies to promote exports in specific industries.

This was in response to KEPSA’s thematic areas of focus outlined by Ms. Carole Kariuki as:

1. Spurring jobs and inclusive wealth creation
2. Social transformation to reduce inequalities
3. Enhanced governance and economic stability
4. Spur cutting edge innovation & investment in competitive human capital
5. Creating a globally competitive business environment

While Mr Odinga’s proposals are laudable, pundits may argue that some of the proposals are ill informed and not necessarily what is needed. Case in point, the proposal to offer tax breaks to large entities as a means of spurring investments and economic growth.

In the past, based on research from institutions such as the IMF, tax holidays in developing countries are not necessarily the optimal driver for economic growth, reason being that the same is prone to abuse and extension by investors through creative re-designation of existing investment as new investment (for example, closing down and restarting the same project under a different name but with the same ownership). Further, tax holidays provide a strong incentive for tax avoidance, as taxed enterprises can enter into economic relationships with exempt ones to shift their profits through transfer pricing (for example, overpaying for goods from the other enterprise and receiving a kickback). Moreover, time-bound tax holidays tend to attract short-run projects, which are typically not so beneficial to the economy as longer-term ones. Furthermore, the revenue cost of the tax holiday to the budget is seldom transparent, unless enterprises enjoying the holiday are required to file tax forms. In this case, the government must spend resources on tax administration that yields no revenue and the enterprise loses the advantage of not having to deal with tax authorities.

Within the Kenyan context where less than half of the population pays taxes vis a vis those that rely on government services and in view of the country’s growing foreign debt obligations perhaps alternate more feasible strategies should be considered or perhaps amendments that are alive to the country’s situation.

About Mkenya Daima Initiative

The initiative is a non-partisan multi-stakeholder platform launched in 2012 whose primary purpose is to inspire Kenyans towards peaceful elections and prosperity thereafter.

It was inspired by the private sector involvement in the Kenyans-for-Kenya initiative and the 2008 National Accord negotiation which brought together various stakeholder groups including the Business community, Civil society, Religious Sector, Non-State Actors, Media, Organised Sector Groups (e.g. Youth and Women).

Among the initiatives of Mkenya Daima are:

1. Stakeholder engagements – with the different sectors and institutions charged with the managing elections
2. Round table engagements with the 3 arms of government
3. Presidential & Gubernatorial political debates
4. Community engagements including peace walks, engagements with student leaders
5. Extensive media campaigns – TV (Interview & PSAs), Radio activations, Print (newspapers and billboards), social media; inter alia
6. National Leadership Summits
7. Signing of the Mkenya Daima Peace pledge

The meeting with Mr Odinga was part of the stakeholder engagement and national leadership initiatives which will be ongoing until after the August 09^th General Election. At the forum, the KEPSA CEO Ms. Kariuki explained that this year’s focus for Mkenya Daima would not only focus on peaceful elections and smooth transition, but will seek to build more on Wajibu Wangu, which is rallying all Kenyans to be responsible for Kenya and to choose the right leaders at every level.

Building on the interventions and lessons learned under previous Mkenya Daima phases, Mkenya Daima 2022. The aim of the Mkenya Daima 2022 Campaign would be to foster good political leaderships and accountability for a thriving, peaceful and prosperous Kenya by focusing on these 3 Key Pillars:

1. Political Pillar – Leadership and Governance
2. Economic Pillar – People Centred and Economy led Manifestos
3. Social Pillar – Peaceful elections and smooth transition