In a televised address on 23 November, President Uhuru Kenyatta again placed corruption top of his agenda, just 10 days after a report connected State House to collusion in corruption by the military with Al-Shabaab. He declared corruption to be a national security threat, and called on religious leaders to declare it a sin against God and humanity. Kenyatta proposed new legislation, a new corruption court and announced a blacklisting system for government suppliers engaged in corrupt procurement practices, as well as his intention to pursue government officers involved.
The proposals for blacklisting are comprehensive. Any firm doing business with the government will have to sign a Business Code of Ethics. Those firms, as well as their directors, found in breach of the code are to be barred from doing business with government for five years. He also announced a Bribery Bill, prepared by ‘the Private Sector’ that will target those ‘who give bribes or induce public officials’. The president promised that whistle blower legislation will be prepared, and that a Corruption and Economic Crimes Division be established in the High Court, and that all customs, immigration and tax officials are to be vetted. He warned the banks that new regulations to tackle money laundering would be prepared, and any current wrongdoers pursued, collectively and individually.
Given the prevalence of corruption in Kenyan society, it is difficult to judge President Kenyatta’s intentions, given that as son of the country’s founding father, there is nobody who is more a product of the system than he is. Even if his intentions are pure, political support and administrative implementation will always be the challenge.
Yet there is no doubt that corruption is out of control. Just last week, Kenyatta’s cabinet secretary for devolution, Anne Waiguru, resigned on supposed health grounds, after months of pressure following allegations of procurement fraud in her ministry (see East Africa Politics & Security – 07.07.15 and 29.09.15). His Deputy President William Ruto has also been accused of being behind a Nairobi Hotel, the Weston, that grabbed a primary school’s land for a car park. Yet these are just examples of day to day corruption. More worryingly, of the US$2.75 billion raised in two Eurobond issues in 2013 and 2014, almost US$380 million cannot be accounted for.
But most alarming are the findings of a report released by the organisation Journalists for Justice, and authored by journalist Ben Rawlence, that describes collusion between the Kenyan Defence Forces (KDF), al-Shabaab and the Jubaland Administration in controlling the smuggling of sugar into Kenya via the KDF controlled port of Kismayo in southern Somalia. The report alleges that up to US$13 million per year is generated at Kismayo for KDF officers and co-conspirators in the Ministry of Defence, Immigration and State House. A further US$17 million per year is generated for them through road tolls on the route from Kismayo to Dadaab. Al-Shabaab and the Jubaland administration are also alleged to benefit from the tolls and port charges, though to a smaller degree.
The report’s conclusion is devastating – that KDF is in Somalia principally for business, and that business can only be conducted if al-Shabaab is operational. For major investors in Kenya, these findings are important. The run of the mill public procurement corruption that was addressed by President Kenyatta in his speech may ultimately increase costs, and encourage corruption in private sector procurement. It may also drive up costs in terms of taxation and immigration.
But the corruption outlined in Somalia is of another order. Al-Shabaab activity has undermined the coastal economy, made much of the north east a no-go zone, and ratcheted up security risk assessments across the region.
Unless President Kenyatta is prepared to address this, his new approach will soon be forgotten. This is his third high profile push against corruption. His March 2014 State of the Nation speech has had little impact; and his 2013 initiative of launching a website to report corruption directly to State House is gathering cobwebs.
