Thursday, 26 July 2007

Kenya 2007:Less dependent on foreign aid?

By Barney Jopson

Published: June 13 2007 10:41 | Last updated: June 13 2007 10:41

Fifty years ago, starting in Ghana, a string of African countries began to win independence. But in spite of political autonomy, many needed donor aid – and still do. Kenya would like to think it is different. Just 5 per cent of its budget is funded by donors, compared with 50 per cent for some neighbours.

Martha Karua, justice minister, told members of the Kenyan diaspora in London in March: “When I hear a foreign diplomat or a development person trying to talk down to us, I always ask them: ‘Excuse me, don’t you think your voice is disproportionate to your money? If you have an issue, we welcome you as a friend to discuss it. But don’t talk like you’re the colonials.”

Government spending in 2006-07 is expected to be KSh566bn, the bulk funded by tax revenues, which are rising thanks to economic growth and more efficient collection. Borrowing, which contributes the rest, is also on the up. The budget, however, does not tell the whole story as it does not include funds from non-governmental organisations, nor does it show aid flows triggered by specific events. When drought struck parts of the country last year the government was compelled to call for assistance even though there were surplus crops in some regions. It is also questionable whether the government could have pursued its policy of universal primary education without significant contributions from donors.

Still, the Kenyan government is less dependent on foreign aid than many and can, ironically, attribute that to its failure to become a free-market democracy under president Daniel arap Moi in the 1990s. Donors led by the World Bank and International Monetary Fund cut off lending several times during the decade in protest at human rights abuses and corruption. By the end of the 1990s this had precipitated a grave financial crisis. Kenya had to weather it alone but by doing so learned how to live with less foreign assistance. .

No comments: