Kenya’s growth path echoes footsteps of Asian nations


Reports that Kenya has signed contracts for the phase one development of Konza complex is welcome for several reasons.

It suggests that the next government elected on August 8 will be under a contractual obligation to complement the current infrastructure projects with the development of Information Communication Technology skills and competencies.

These have the potential to propel the country into the status of a fast development – one in a single generation. A look at the Asian “Tiger” countries that accomplished this feat in between two and three decades reveals the steps the country needs to take to achieve this goal.

The leadership needs to understand and accept that building the technological infrastructure that will leapfrog the country from the agrarian stage of development into the 21st Century will require huge amounts of money.

There should be an appreciation, too, that these huge amounts will have to be sourced from internally.

The launching and future development of M-Akiba platform to borrow money from ordinary Kenyans — and at reasonable rates — may help provide some of the money required.

The government may also consider raising the money it needs to recapitalise the Development Finance Bank it is expected to establish with the merger of three State banks. The government could, for example, promise investors in those bonds that they would have the option of converting their investments into shares in the new bank once it demonstrates a track record of posting profits. The reason for other countries reluctance to finance Kenya’s development that makes it competitive is easy to understand.

It is understandable, too, that foreign companies would not encourage the development of innovative technologies that would disrupt their already existing ones,  yet these disruptive technologies are the ones that move economies forward.

Technological products

The State must also lead in the development of State-of-the-art factories to make some parts for the technological products being churned out of Europe, India and the rest of Asia especially China.

The efficacy of this method is borne out by the realisation that this is the path followed by Taiwan and China. The two first contract manufacturers producing parts for the assembling of computers and telephones made in America and Europe.

This enabled American conglomerates such as General Electric, Apple Computers and International Business Machines (IBM) to post huge profits because the bulk of their parts were produced at factories where the labour costs were low and productivity was high.

On their part, these countries received technological skills and expertise at little cost to themselves and today, they have emerged as major competitors to their former clients.

Indeed, China went a step further and bought the computer business of IBM and renamed it Lenovo. South Korea took a slightly different path by, first, concentrating its efforts on the development of TVs and home appliance products.

It is only after establishing a firm foothold on the global market with these consumer goods that it turned its attention to the development and manufacturing of mobile phones.

The competition South Korea’s entry into the global market with Samsung mobile phone brought about saw the near- exit of former giants Nokia and Ericsson.

This explains the palpable in the ICT sector following reports that South Korea has committed Sh12 billion to set up Kenya Advanced Institute of Technology modeled on the Korea Advanced Institute of Technology at Konza metropolis.

The close working relationship between Kenya and South Korea during the construction and running of the institute can be lead to Nairobi persuading some Korean technological firms to produce the consumer goods meant for the African market here.

Experience elsewhere demonstrates that one major global player locating its operations in Kenya will see others follow.

The decision to equip public schools with computers and have some of them assembled locally will see the dream of turning Kenya into a continental technology hub become a reality.

[Mbatau wa Ngai] [email protected]

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