The impact of poverty in Kenya on international trade

Executive Summary Kenya achieved independence from the colonial rule in 1963 and its finding mission was to fight poverty, ignorance and disease. Kenya has done a spectacular success in achieving these objectives, the first decade since independence was characterized by a rapid growth of the economy, infrastructure and increases in essential services across the country.

This rapid increase growth was supported by a strong and well-respected Civil Service, trained and equipped security forces and a judicial system. Kenya was among the success stories of post-colonial Africa in which primary school enrolment was ever increasing, health care systems and the income per capita was rapidly growing, in the first decade coffee and tea linked Kenya to the world as an export oriented economy. Introduction

Through the success achieved in the first decade of independence there was hope and confidence that the vision of the framers of the constitution of Kenya was to have Kenya free from hunger diseases and ignorance being realized sooner rather than later, but this did not sustain itself in the recent decade Kenya has been worst economically with the growth of the economy rarely keeping pace with the population growth. Kenya is now a low income, food deficit country with an aggregate Household Food Security index of 71. 7 FAO ranking it 51st of 61 countries.

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Close to 60 percent of Kenyans live below the poverty line, in which the outstanding indicator of poverty is hunger, rising unemployment, negligible growth, ill health and lack of education. The people of Kenya are getting poorer and poorer, industry and services collapsing with a reduced effective demand in which over half the population of live in absolute poverty. Discussion The life expectancy in Kenya has dropped from 59 years to 48 years under which droughts and periodic conflicts have been increasing, primary school enrolment rates has dropped and dropout rates increasing in the past few years.

Fees and other payments to schools have served to exclude more children from the formal education system. There is an increasing number of children engaging in cheap labour to support household economies. Teenage pregnancies and resulting dropouts from schools continue increasing this case is even fuelled by unscrupulous teachers and other guardians who exploit the girl child. The HIV/AIDS scourge has added to the negative trends whereby, over two million adults are currently infected resulting to over one million orphans whereby those living with HIV/AIDS have to face the burden of stigma and exclusion.

After the introduction of multi-party politics in Kenya in the early 1990s and especially after the general elections in 2002 the parliament is gradually emerging as a very active and independent institution with a rising significance in the country’s policy-making process, though there are so many hindrances that the parliament faces include: cases where many Member of Parliament are caught up in the country’s patronage system which has permeated the political system, there is a considerable evidence that a large number of Mps are pursuing vested interests and they do not contribute substantially to the development of an issue-based political decision-making process.

The political parties which play an important role in the parliament are in one way or another related to ethnic issues whereby the executive arm of the government has tended to treat parliament as a subsidiary institution and still continues to exercise control over it. (Murungi, 1998:423 - 42).

Globalization has also contributed to growing poverty in Kenya, Falling global prices for Agricultural production has resulted to falling revenues from Kenya’s main exports and of tea and coffee, tariff and non-tariff barriers particularly in the US and EU has blocked the development of sectors such as textiles and livestock As a result the roads became almost impossible to navigate and therefore companies could not transport their finished goods or raw materials in time.

Kenya relies most on horticultural produces that needs quick and smooth transport but due to poor roads conditions then the sector was abandoned, though dominated by international companies for export purposes. A ban on fish sales by EU occurs due to sanitary measures reduced incomes of fish farming both at the coast and along Lake Victoria. Also the dumping of cheap, imported sugar has crippled the sugar sector while enriching few traders.

Kenya has a dubious distinction of being the most unequal poor country in the world in which few elites in politics and business have extra-ordinary control over the country’s resources, the elites have systematically plundered with no accountability, large loans have been taken and remain unpaid, the perpetrators of grand larceny such as the Goldenberg scam are yet to be brought to justice. Environmental destruction go largely unchecked where unauthorized deforestation is practiced.

The other divide in Kenya is between men and women whereby there are only eight women in parliament out of 222 members of parliament. Women are continuing to be subordinated by customs such as early marriages, widow inheritance and female genital mutilation. Though some laws are changed in order to restore equality with men, women still do not own control land and other productive resources, women’s issue is still trivialized and they continue to be to suffer from discrimination and exploitation.

There is no community that does not have a substantial proportion of people living in poverty in Kenya, the central province in Kenya has been long considered the well off province but in it 31 percent of the people are poor, Nyanza province has 63 percent people living in poverty this has rather suddenly in this province since the province is related directly to high incidences of HIV/AIDS. Some of the groups are worse off than others and their experience of poverty and the denial of rights and social justice is severe, these groups include: landless, subsistence farmers, pastoralists and casual workers, women, HIV/AIDS orphans, street children and people with disabilities are vulnerable.

Apart from the factors mentioned above Hunger is also recognized as a perpetual cause of poverty in Kenya, whereby, Welfare Monitoring surveys conducted by the government indicate that three-quarters of the poor live in rural areas while the majority of the urban poor line in the slums and peri-urban settlements. The poor constitute more than half of the population of Kenya at least one in every two Kenyans is poor. Hunger in Kenya is caused by countless factors that are rooted into the people social, cultural, economic and environment circumstances.

The structural causes of hunger leading to poverty include: HIV/AIDS this is seen as a major contributor to poverty and hunger in Kenya, children affected by HIV/AIDS is often deprived of their rights to health, education and protection. It causes greater hunger through reduced food production and income as the family members engaged in agricultural activities become less productive and eventually die.

This disease increases hunger through time taken to care for the infected and orphans could otherwise be used in productive work. Aging generation communities identified as old age is regarded as a critical factor to structural hunger and poverty in Kenya. A household headed by a person aged over 60 years and above is likely to hunger because of their inability to work, the person lacks energy to get involved in activities that can enable him produce food in the farms or other income generation activities. Insecurity and ethnic conflicts this is particularly present in pastoral districts of Kenya it is caused by scramble for water, pasture and cattle rustling.

Inadequate rains and droughts a combination of climatic changes and environmental degradation in arid and semi-arid lands like in Turkana district droughts occur at an interval of three years leading to acute food shortages and chronic hunger, rainfall failure and drought reduces availability of water and vegetation for both livestock and pastoralists, lack of livestock means the lost of the source of primary food, milk and blood.

Lack of appropriate hunger reduction policies-the government response to extreme hunger has been reactive rather than proactive, past interventions aimed at relieving to adverse effects of hunger by both the government and other actors have equally not produced much this results in the forestalling the recurrence of extreme hunger in the country leading to great poverty.

High unemployment rates-employment opportunities are lacking completely, if they were available the poor would have a source of income so that can be used to buy food and also improve the quality of farming practices, lack of money is attributed to limited employment opportunities for the youth and other people. Other impacts to the international communities were the issue of security.

Due to high unemployment rate many were idlers and started engaged themselves in robbery with violence, raping, and car hijacking. International investors became victims and most of them were from Asian community who had family businesses. As a result many investors decided to leave the country to neighbouring countries to start businesses there. Poor Leadership-Disunity, poor leadership and representation is reported to have contributed to increased poverty in Kenya.

Local elected leaders are accused of neglecting their roles in advocating for government services, especially human health and animal health. Poor farming practices-some community members have not mastered effective family techniques and do not have adequate farming tools, farms are very small and water to irrigate is insufficient. Pests and livestock diseases also play a role in reducing the amount and quality of products in crops and livestock. Accomplishments To safeguard the needs of the poor, who may be excluded from immediate gains of economic growth, measures have been taken to allocate and ring fence budgetary allocations that directly contribute to poverty reduction.

In this respect, comprehensive criteria for selection of core poverty programs has been developed including the following measures: Increasing incomes for the poor such as minor roads/access roads, agriculture services and access to credit and financial services, improving the quality of life e. g. healthcare services, water, free primary education and environment management; improving security and governance, involving the protection of human rights; enhancing administration of law and justice; reducing wastage (accountability); strengthening security of people and property; and improving equity and equality, including access to employment opportunities as well as empowerment programs.

The revival of the East Africa community with Tanzania and Uganda in preparation for free trade zone has prospects of lifting the economic gloom in the country.

More importantly the progress of World Trade Organization rulings on subsidies in the North and market access for developing countries this will have an important role to play in boosting production and exports. Another vital foreign exchange earning sector in Kenya is tourism in which funding for marketing been increased, the upgrading tourist police force and diversification of the markets is underway, both in terms of geographical distribution and customers based.

Poor farmers have been empowered through increased smallholder access to credit, increased institutional efficiency and strengthened of extension services. The farmer’s co-operative movement has been revamping the co-operative movement by reviewing the Cooperative Societies Act to improve governance in the agricultural Sector.

President Mwai Kibaki who was democratically elected in 2002 with a ticket of a coalition government has brought a major improvement in the governance, whereby the government is committed to restore economic growth, create jobs and reduce poverty. It is trying to empower the common man. The government has also ensured that primary education is provided free of charge and through which most of the street children have been rehabilitated and taken back to school. The government is trying hard to make sure AIDS drugs and the health sector can be locally available and affordable to all. Also the infrastructures services are better now and the security is improving.

Proposed programs has been implemented in many parts of the country such as Water Developments whereby many NGOs have intervened to develop and rehabilitate water sources both for humans and livestock, this normally done by drilling boreholes, shallow wells, protecting and developing springs and constructing water ponds, aiming to enhance people’s health and livelihood.

Reforms have been made in the financial sector under which a Financial Sector Assessment Program (FSAP) have been developed to focus on reducing interest rate spread; enhancing investor confidence and consumer protection; establishing effective financial sector regulator; dealing with None Performing Loan (NPLs); and creating an independent insurance regulatory.

Enhanced media coverage on poverty is playing an important role raising awareness of the problem among the general public and thus benefiting some NGOs, Civil Society groups and the government to devote more attention to poverty reduction and putting it up their list of priorities. Recommendations The government needs to invest both in rural and urban infrastructures.

This is to encourage decentralization of the industry within the major cities. It needs to privatize public companies to discourage monopoly opening a free trade market attracting more investors both local and international who maybe willing to become either partners or new competitors. The government should give incentives to the foreign investors to encourage them invest in Kenya.

The government should help those small-scale individuals to form an association that would market their products internationally and neighbouring countries to encourage industrialization. The government should encourage mobility of labour to encourage more productivity and to improve quality of life. The government should be stricter with financial institutions whether private or public simply because they are transacting public wealth.

Therefore a department in Central Bank of Kenya should be created to foresee and to monitor the day-to-day activities of those institutions. They should be held accountable and responsible for holding public funds. The government should encourage mobility of labour to encourage more productivity and to improve quality of life.

The working system does not favour the employees who have ability to work in more than one job because the system can only allow him to work for a maximum of eight hours a day.

References AMREF et al. (2001):Participatory Poverty Assessment Report: For Poverty Reduction Strategy Paper, Govt. Printer Barnett T. (2003): The effects of HIV/AIDS on agricultural production systems and rural Livelihoods in Eastern Africa: a summary analysis, FAO Booth, D. (2003): Fighting Poverty in Africa: Overseas Development Institute (ODI) Forsythe, S. and Rau, B. (2004): AIDS in Kenya: socio-economic impact and policy Implications, USAID/AIDSCAP/Family Health International Government of Kenya (2000): National Development Plan 2002-2008: Effective.

Management for Sustainable Economic Growth and Poverty Reduction. Min. of Finance and Planning, Nairobi, Govt. Printer Government of Kenya (2000): Second Report on Poverty in Kenya Vol. II: Poverty and Social Indicators. Min of Finance and Planning, Nairobi, Govt. Printers International Monetary funds (2002).

Country Strategy Paper: Investment Programme For The Economic Recovery Strategy for Wealth and Employment Creation 2003-2007, International Monetary Funds, Washington D. C, Retrieved from, http://www. imf. org/external/pubs/ft/scr/2005/cr0511. pdf, on April 9, 2007 Wakwabubi, E. (2006): Moving out of Hunger in Kenya, Participatory Methodologies Forum of Kenya (PAMFORK).

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