Global crisis: Kenya should heed the signs

January 28, 2009

NAIROBI, Kenya, Jan 28 – It seems like whichever way you turn, the effects of the global economic crisis are being felt all around.  The firms which have either gone under or been taken over reads like a list of who’s who in power brokerage. 

The cash crunch began with the collapse of the Sub-Prime mortgage market in the and became even more evident with the nationalisation of major banks like Northern Rock and Royal bank of in the U.K as well as mortgage lenders Fannie Mae and Freddie Mac in the  

Thereafter came the Stock Market crash in September 2008 and more job cuts in an effort to increase profit margins.  From the take over of Investment Banks such as Bear Stearns to the decline of car sales at General Motors and Ford late last year, no industry seems to have been spared this onslaught.  For the first time in 15 years, Toyota has decided to halt production in all its Japanese plants for 11 days in February and March this year. In the midst of the chaos, the Bernard. L. Madoff Investment Securities, a seemingly successful business ascribed to by the rich and famous, came to light as a Ponzi scheme.  What more could go wrong?

In Africa, the effects of the economic crisis translate into a reduction in trade, reduction in Foreign Direct Investment, liquidity problems and a cut back in spending on Aid.  Consequently, the multiplier effects of this crisis have been felt in as the tourism industry experiences serious decline in revenue due to the decrease in the number of foreign tourists, unmatched inflation rates, sky-rocketing food and fuel prices among others. 

Plagued by double jeopardy, Africa still has to deal with other problems such as chronic food shortage, war, disease and corrupt leaders who imagine and lead our countries like their personal kitchens with little or no regard for the welfare of the citizenry.  While is rocked by crisis after crisis with no end in sight for corruption and impunity, power sharing talks have stalled in and their President refuses to acknowledge the Cholera outbreak.

Yet it is said that these consequences being felt are just the first round of the global economic crisis.  It is expected that in the next round, consumer credit will experience the highest cash crunch with people who have been living on credit being pushed to the threshold of poverty.  Even though the majority of our people do not live on consumer credit, I have no doubt that our beloved country and continent will not be spared the pain of the coming round of the financial onslaught.

It is with this background in mind, that I want to express my utmost disappointment over the way our leaders continue to behave.  We are facing momentous adversities in the name of recession, drought and hunger and yet our leaders remain unfocused.  Everyday when we read the papers and tune in to the live debate, all we witness is the infighting among our leadership.  It is deplorable; the institution of our leadership which cannot borrow a leaf from President Obama and get to work on matters affecting our nation with gravity.

Let us not fail to take heed of warning signs such as those which were echoed about 8 months ago about the impending food crisis.  If we had heeded those calls, maybe we would have avoided the scandals rocking National Cereals and Produce Board.  Clearly, there will be job cuts as companies struggle to stay afloat in this environment.    Clearly, our stock market and listed companies may continue to loose value in the months to come.  What is our government doing about it? 

 I call upon our leaders to show us the way.  Let them focus on strategies to create jobs in the future, on strategies to safeguard our companies from this crisis, on strategies to feed the dying and starving populace and on strategies to deal with corruption and impunity without derailing us from our course.  To our media partners, we ask of you more responsible and accountable journalism practices.  Please help us to demand more from our politicians with a view to shielding from the full effects of the global economic crisis.

Let not our future generations echo the sentiment that we failed them by focusing on mole hills instead of mountains.

Latest Articles

Live prices

Stock Market

Most Viewed