Kenya Currency
For the trained eye, the above does not look good. This is the most recent month development of the exchange rate of the Kenya Shillings versus some European currency. What we are witnessing now is that a pretty volatile period, where the exchange rate has been kept stable by the Central Bank of Kenya by continous intervention to keep the Kenya Shilling from being speculated against (by forced stabilisation, every 10 minutes), it occur to me, that the external forces are now beginning to be too big. What you see at the right hand end of the above curve is volatility which cannot be maintained anymore. It may INDEED be, that the Central Bank of Kenya will manage to maintain the exchange rate, but the trend above is not good.
It is imperative to understand what drives this curve this way. Do not fall for rhetorics that this is the GenZ's fault. That the curve is going this way due to that Kenya did not get it's loans from IMF or World Bank. This would be false political rhetorics, and even a lie.
What makes the curve do like this, is when the import is bigger than the exports. So. It is the contrary which is the case. GenZ has numerous times written that these big imports of big, expensive and unnecesary vehicles must stop. It is perfectly OK to import second hand good brand vehicles, for instance buses, transporters, matatu's (vans), trucks. There are so many good brands of these, and the Japanese and other markets are booming with right-hand steered versions of their vehicles in second hand (mostly due to that they drive in left side of the roads too in those countries.
Therefore on the contrary, if we are to implement austerity measures in Kenya, one of the most important areas to implement austerity in, is within the import of unnecessary goods. Kenya can, as has been lamented on endlessly - produce its own peanuts. Why pay for transportation and growing and so on, when there are soils on Kenyan land, ready to grow peanuts - and grow them perfectly?
It is imperative that Kenyans - maybe led by the GenZ - begin to SIT on the importation of goods. Implement a steering committee - and implement working groups or cohorts of professionals led by GenZ, who shall form a committee who will again employ import controllers who will vet whether a certain import is of importance for Kenya or not, seen purely in a perspective of direct, indirect or even indirect indirect exports.
Agricultural machines is naturally a great import. But - swimming pools - smart lawn mowers for private households - is out of the question - while swimming pools for hotels and so on - should naturally be allowed. However. When discussing swimming pools - these can be BUILT, gentlemen - based on raw materials, stones, cement and sand from Kenya - and special paints or tiles if you want - coming from Kenya, instead of importing "Swirlpool" and other silly fabricates from abroad.
It's Kenya's time
Time has come, if you ask me, to strengthen Kenya's export tremendously.
Large Scale Software Export
One of the ways this could be done would be to train Kenyan's in IT, but not only that - also organize Kenyans, at country level, so that groups of Kenyan corporations could organize in for instance a "Kenyan Systems Exporters Association" or similar - and thereby ensure that Kenya would begin to take a good chunk of the international software market by simply exporting software.
Servers Run on Volcanic and Solar power
Kenya has Ol Karia, which is a sector of Kenya producing energy from volcanic activity in terms of steam generated power made by water pumped into the ground and then coming up as steam, driving huge generators in the Rift Valley. This power can be used, throughout the night when nobody uses is (!) for operation of international server parks, placed on Kenyan ground. During day time, solar cells, placed in the mountains, ie. up at Longonot crater or elsewhere, can provide day time power fetched from above the clouds. Thereby Kenya would be able to provide for totally green power solutions. During day time, then industries etc. would take extra power from the ol-karia. During night time these industries are closed.
It would be a possible thing to setup server parks, run by expertise Kenyans, trained in Kenya by help of professional colleges exporting training to Kenya - for instance the ZBC college in Denmark could do this - and thereby expertise would be available in Kenya, to serve the world with server structures, data storage, backup, AI-training capability etc. etc.
Electronics Manufacturing
I have with my own eyes seen 3 different super advanced electronics manufacturing sites in Kenya, run with the utmost forefront equipment for EMS business. One example is the Gearbox site in Industrial Area in Nairobi, which is already overbooked with jobs, to an extent where they could not take in extra work (!). WHO would have expected that? Would you believe that this photo here is from Kenya? I took so many other pictures in Gearbox, but this here is with their staff on. Nobody can be in doubt that these guys are Kenyans :-)
Value Added Coffee Export
A more detailed example
Similar - it is such that value added coffee is selling like hot cakes in EU and USA. But. The farmers in Kenya has very little incentive to do anything in regards to farming great coffee, because, the coffee traders both locally in Kenya and abroad have not seen the light. I would indeed like to assist the Kenyan coffee farmers organising ownership of corporations in EU, if need be we can arrange to have our name on the papers. Reason being that import levies on value added coffee prevents the huge profits from being made in Kenya. But if the corporation is largely owned by Kenyan farmers, via a holding structure, then surely the profits would largely then go to these farmers. Then we can do all the magic here in EU, while the profits actually ends up in the pockets of those who do the biggest job - the farmers. This would tremendously add to the lean coffers of Kenya.
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Where does GenZ come in?
The GenZ comes in - in that - if they can ensure that they start sitting on the finances in Kenya, by having their county represenatives and elected members of parliament respond to them in their various counties and actually do their job as elected - and serve their electorate - and if the GenZ can make this happen peacefully so that Kenya can be reckon'ed with internationally, then I will suddenly feel that I was doing something great by making this happening. Right now I would not touch coffee trade even with a pole - because - the middlemen scores the profits - and the farmers gets nothing.
"Money Trickles down", or?
The rich people have hitherto said, that their richness "trickles down" to the poor. Well. Then I would like to employ that logic and then say that if we let the coffee farmers earn the profits more directly - then the richness of these farmers would then trickle up to the former middlemen, isn't it? Why don't we try that model for some 10 years to come?
Why would I want to just become another middleman?
Reality with proper governance in place
So. Instead. I would be perfectly fine with a tiny little corner of the business - say - 4% - then the 96% can go to the farmers. This would create equity and balance in the coffee trade. Right now as it is, there are so-called "Fair Trade" corporations who are just masked thieves. They pay a little bit extra and makes a lot of hoola-balloo about their "good" way of doing business. But. Frankly speaking - 1 kilogram of coffee trades at USD 240.10 (KES 80,216) per sack of 50 kilogram, or, USD 4.80 per kilogram. In Denmark, coffee trades at DKK 30 per 400 gram = USD 10.96 per kilogram, or with an added value of 128 %. Transportation of 33 tonnes of Coffee cost USD 8,000 or USD 0.24 per kilogram, which is negligible.
If we now take one shipping container, with 33 tonnes of coffee, costing USD 4.80 per kilogram, and sell it at USD 10.96 per kilogram, then we would see a profit per shipping container of USD 203,280. Or in Kenya Shillings - Kshs 26 M. That is - profit, which normally goes to the middlemen. I would be happy with Kshs 1 M, in EU. Then the remaining Kshs 25M could go to the farmers. The statistics from FAO says that one hectare produces something like 500 to 800 kilogram of green coffee beans per hectare. So, in order to fill a shipping container with 33 tonnes of green coffee beans, that would take 33000/800 to 33000/500 = 41 to 66 hectares of land to do so. Kenya has around 119,000 hectares under coffee farming in 2024.
The sum of this is, that Kenya currently sell around 45 million kilogram of coffee per year, at a rate of USD 4.80 per kilogram, resulting in an export of roughly 225 million USD, while Kenya likely could earn the double - or 450 million USD, given a proper market.
If we now take value add on Coffee, that is - creating coffees for special purposes - like with milk, or for espresso - or with cream+sugar - then again here is a cash cow to milk. However. If Kenya start milking that cow now, the vast amount of the profit would go to the middlemen and not to the farmers.
With a GenZ ruled economy in place - where the GenZ simply sits on the budget, the allocation, the payout and controls of the trades, I would dare venturing into this business as I would know that it would benefit Kenyans tremendously, grassroot up!
CONCLUSION
Kenya can get its currency up again. Kenya can also take more loans to get there. But there are circumstances and necessities to be fulfilled in order to do so - that is that the so-called profesisonals take a deep breath, and start listening to the GENZ's. They may not have the acumen to run a government with the thousands of arms and things necessary to do, but one thing they know is, that it starts with getting the finances in order...
There is ONLY ONE, and ONE ONLY way to get the finances of a country in order, which is to ensure that everyone in that country have a real chance of having success in their lives. There is only one sure way to establish that success for everyone - that is to establish INTEGRITY in any and all actions people do in that country. That includes small people and big people.
Corruption is countering any integrity. It is unfathomable that the older generations who are so engulfed in corruption have not seen the writing on the wall? Themselves and their offspring will die under terrible conditions if they do not stop this corruption. Kenya is at the brink of collapse due to corruption. The GENZ has given everyone who is engulfed in corruption in Kenya a chance to stop and rethink, and to put measurements in place as stipulated by GENZ:
by ensuring that any and all MP's (Member of Parliament) start having weekly consultancies with their electorate, so help them God and GenZ.
GenZ have clearly understood - likely by the help from Price Waterhouse Coopers (and maybe others), that when they (GenZ) take control of the economy - then they get a grip on the balls of the government. That means - if the government behaves well - everything is fine - but if they continue misbehaving and looting, then the GenZ will find them and Z'ap them.
God Bless Kenya
God Bless GenZ
God Bless everyone who supports Kenya's people who is indeed wonderful people.
/ David Svarrer
Software Engineer | Digital Health Advocate
7 个月I didn't get the long post alert, but very sound ideas ??
The Wise Realizes His Ignorance - Thomas Sowell
8 个月The Kenya Shilling is continuing its fall. It appears likely that highly placed officials in Kenya intend to take these loans and loot them. Foreign loans can be good, if SOLELY spent on export generating activities and if the planned activity can for sure generate more foreign revenue than the loan value hence cause a NET Debt Reduction. Austerity is worth it on that background (But maybe not even necessary!!!) BUT PRIOR to any such facility, #GenZ with their parent #GenX, together with MP's (who must be called back to their constituencies to be given instructions on how to vote), must pass, in parliament, an emergency law, opening up for scrutiny of public spending by a cohorte comprising: #GenZ, #GenX, an armada/army of accountants, a coordinating software, so that the finances of Kenya are to be taken control of, by the people, via their elected and now controlled representatives + accountants of people! Kenya's democracy can indeed be revamped. All mechanisms are there. It is only the representatives who have forgotten who elected them, and that they MUST represent their electorate in parliament. So. Those constituents who have "lost contact" with your MP - recall him, educate him, and if dysfunctional replace him!