Kenya’s Money Magicians
I want to talk about magicians in this post because they have this amazing capacity to reproduce things out of thin air. Things like…oh…let’s see…bank profits, revenue streams, idea’s, hopes and dreams.
I’ve said before that one of my favorite magicians today is a fellow called James Mwangi. Yes, he the current CEO of Equity Bank. I’ve been hearing stuff about the hat tricks that this banking genius magician is pulling out of his hat and I’m beginning to wonder about what’s really going on over there.
The first story begins with the largest shareholder of Equity Bank who I’m told is Kenya’s largest chicken farmer. As I’ve said before in numerous posts, the only real producers in Kenya are it’s farmers and it’s no surprise that Equities largest shareholder is a farmer (they are the one’s with the money & everyone else just has services to cater to them).
Anyway, I was told that this chicken farmer took out a loan of Ksh. 70 million shillings from Equity bank (using his shares as collateral) and his goal was to use this money to build a school for disadvantaged people. So, before the terms of repayment were due, this guy noticed that withdrawals were being made from his bank account at Equity without his permission. i.e. someone at Equity Bank was taking money out of his account (ostensibly) to pay off this loan.
When the guy went to Equity to inquire about why they were doing that, Equity apologized and stopped. However, since this guy didn’t want people dipping into his account without his permission in the first place, he repaid the Ksh. 70 million shillings at once in order to stop those unauthorized withdrawals.
Then, on the advice of someone, he told James Mwangi that he wanted to cash out Ksh. 2 billion of his shares. This someone had told him that in order to protect his investments, he shouldn’t have everything sitting at Equity Bank. So, cash out some shares and re-invest it in real estate and diversify your portfolio and reduce your risk (just in case something happens).
Now, when James Mwangi heard that this guy wanted his Ksh. 2 billion in cash, he told him that he would only need that kind of money if he were starting a bank! 
.
So, as I am listening to this story being told to me, I start wondering about my favorite magician again. 
I can understand why Mwangi wouldn’t want such a large cash withdrawal to occur at his bank, but then, I also asked myself what Mwangi would have done had this chicken farmer insisted on getting all his cash? (for some reason, the farmer never insisted on the withdrawal, but I was never told why).
I suspect that had this farmer insisted on getting his ful Ksh. 2 billion, Mwangi & Equity (by extension) would really have been screwed because I don’t think the money is there! Money just doesn’t sit in a bank’s vault once you deposit it there. It’s moved around into various investments, but unless you are on the inside, you’d never know who is moving it or to where.
So, why would a seasoned businessman leave Ksh. 2 billion or Ksh. 3 billion shillings in the hands of James Mwangi at Equity Bank? I would have cashed out all my shares and moved that money out to Barclays Bank, pronto.
The second favorite magician I want to talk about today, is Eddy Njoroge. This guy could have a matinee show in Vegas with all the magic tricks he’s been pulling out lately, but for today, let me focus on just one magic trick, which was told me.
Apparently East African Cables, which is owned by Transcentury (the mother of all magicians) is not really a cable company. Nay. They are a tendering company. That’s right. You see, I am being told that they don’t own any of their equipment and they don’t even have the necessary expertise required to install the equipment or to do anything for that matter.
What I am hearing is that because of the political connections that Transcentury has, they are able to get all the government tenders and contracts, but since they actually don’t know how to do the work, they are sub-contracting it to a different cable company called Kenwestfal cables.
Now, you can see why East African Cables is not making money and will never make money. It is run by a bunch of people who are only interested in wheeling and dealing, not in producing long-term profits or even producing anything for that matter. So, as long as Kibaki is in power and they have the connections to get the tenders, they will survive, but as soon as a new regime comes in, wave your magic wand and say goodbye.
This is the problem with an economy built on a wheel & deal culture. The businesses are only sustainable for the period of time that a friendly regime is in place. As soon as you lose your connection, your business goes down. We saw it under Moi and with many of the Kalenjin owned businesses. Let me give you another example here.
Kestrel Capital is a brokerage firm owned by Biwott’s son-in-law Charles Field-Marsham. I know on good authority that when Moi was in power, Marsham was specifically warned not to do business with Kikuyu’s. Now, fast forward 7 years later and get into Kenya’s IPO craze. Kestrel Capital did not get any of the IPO transaction deals of any parastatal or of any private company that I know of and they will not get any as long as Kibaki is there. Once Moi and Biwott left, their ability to get the good stuff evaporated.
So, as I try to come to a conclusion here, a few things seem to be true. To get rich in Kenya, you have to do one or two things:
1) Steal lots of land and become a large scale farmer so you can sell or export food or flowers.
2) Find a way to get into government (either politically or through a parastatal) so that you can get the government tenders and contracts and over-charge and over-bill like there is no tommorrow.
Let me add some additional points here on different, but related topics:
The VIP cars ordered by Uhuru were brought in by CMC Holdings. The CEO maybe a mzungu, but the owners of CMC Motors are Njonjo and Kierieni. This is how CMC got the sole contract to supply those new cars at a cost I’m sure that was highly inflated. The mzungu had nothing to do with getting that contract.
Kengen told us that they raised $300 million dollars in 2 weeks from it’s bond from people they described as “foreign investors”. Can somebody please tell me who these foreign investors are? because I’m hearing that there is nothing foreign about any of these investors. It’s simply stolen money being moved around and eventually it’s going to be moved out. In other words, don’t expect any Kengen geothermal plants to be built any time soon. By the time 2012 comes around they’ll be no $300 million left anywhere and the foolish bondholders, expecting a magical (oh..Eddy) 12.5% repayment on their money will be crying (just like the Safaricom shareholders have been left crying).
Nothing seems to be adding up (except through magic)….
I dont believe you. This is just speculation.
Where is the evidence?
me too, if you can substanciate your claims then it would really help. i think in this case you have become the magician of sorts, misleading your followers with bull crap.
FYI banks never store cash of that magnitude in their vaults in one particular day, thats why there is central bank. If you know a bank that does this apart from central bank then i would like to know. I may not be the kenyan entrepreneur but I know the claims you put through are not true, only political propaganda.
Another thing a flood of two billion shillings in one day to the market, you, never know how much ripples it would cause to the economy.
Kimani:
A flood of two billion in the market? What do you mean? If it’s your money and you insist on getting it out, Mwangi has to give it you! The chicken farmer is not the finance minister. He is a private businessman and if he wants his money, he should be able to get it, unless he’s not there.
Who knows what the Central Bank is doing? Ndungu doesn’t answer anyone’s questions and that institution has always been a political outfit. It’s the reason the CBK governor always belongs to the presidents tribe. To think that the CBK is disconnected from the countries general corruption is to be very naive.
Nobody has to believe any of these claims, but like I said in the piece, a lot of the stuff these guys are doing is just not adding up and if you begin to analyze it (without just accepting their stories like they come from the bible) you will begin to see the holes all over the place.
I just thought of something else:
Would any of you guys leave Ksh. 2 billion (or almost $30 million dollars)in James Mwangi’s hands? Particularly given his history at Trade Bank?
Just the other day I read that the government in Zimbabwe had withdrawn money from people’s personal accounts without asking! See link below:
hhttp://www.thezimbabwetimes.com/?p=15609ad
So, I was asking someone how you would prevent such a thing from happening to you and he said, in Africa, you have to deposit your money in foreign owned banks (e.g. Barclays) because you can sue the bank in London (since it’s a british subsidiary). i.e. if you have large sums of money, you simply can’t leave it in an African owned bank because there is no rule of law and because of that, you won’t be able to sue.
So, the real point here is that when you are dealing with people who are operating above the law, you have to be very skeptical about anything they tell you.
ke
You r naive….
Please write a novel…its a better way of telling us what your voices “TOLD” you!
How are we ever going to develop if we cant keep money in “African” banks?
That is deafeatist attitude.
I have an account in Equity and I will soon approach them for a loan for a project.
Equity is doing a very good job.
By the way, I will never keep money in a foreign bank in Kenya. I remember how they treated “common” people before 2002.
If you are going to publish something, publish concrete stuff not just speculation.
There is so much nonsense in this article that it can only ever be published on the web.
Btw hard work and the right connections is the remedy for success in any part of the world, not just Kenya! So you need to stop being naive.
Kenyan:
The beauty of blogging is that you become your own boss and you can write whatever it is you please
I knew this article would hurt people’s feelings and make them very angry and I think the reason people don’t want to believe this stuff is because if you are in Kenya (especially) or if you are in the diaspora and have dreams of moving back, you want to believe that the system is fair and that with a little hard work, you’ll be able to make it.
However, the things I am hearing, about how so many people are making money have pretty much cemented the notion (for me) that without a political connection, you simply will not be able to make it.
Equal socities create viable and sustainable middle-classes. There is a reason why 50% or more of the population is living in poverty.
There is a reason why 10 million people (or more) are facing starvation today.
When you start seeing those kinds of poverty numbers, which have been around since independence, it should tell you that there is a major problem with the system and I am telling you, that the problem with the system is massive theft and corruption, which is making a few people very rich, but leaving the majority to live in abject poverty.
At some point, people are going to have to confront this reality of Kenya, otherwise the poverty is going to keep getting worse and eventually, there will be an explosion.
**one more thing: My voices are now telling me that in 2011, the stealing is going to be like nothing we have seen before because everyone knows kibaki is leaving & they don’t know who will be coming in.
You can’t have 46 years of this kind of continuous, massive theft (of public resources) and not suffer the consequences.
Annon:
It depends on how much money you have at Equity. If it’s not a lot then even if you lose it, it’ll be fine, but the real danger at Equity is that those poor people with small deposits really, really, depend on that money and if they lose it, it will very bad for them.
**My voices are now telling me that COOP bank is looking to buy the loans off Equities books. Why would they do that? hmmmm
KE.
You have become demented with stealing because you failed to make it in Kenya. What is eating you is that all your predictions have been proven wrong.
You thought Kengen would not be able to raise the money they did. You failed in that. Safaricom has moved to become the biggest telecom firm in East Africa. You have been preaching Equity’s downfall for ages it hasn’t worked out for you. You once bashed Kencall now you have eaten humblepie even grovelled to get an interview. You keep talking about Transcentury but they keep doing better to your great annoyance.
I have finally figured out your identity and know for a fact the informer you are using is a politically frustrated individual who has failed to make any headway in the firms you mention because he is a known quantity. So instead he feeds you this crap without any evidence or figures to backup the allegations. Since you are based in the States you can’t possibly verify this info. In any case I have good authority that you have a political agenda.
You are the magician here and all your readers have figured this out. We also know you have Indian connections. Your evil plan against Africans and Kenyans in particular has been fully uncovered. You will be hearing from us soon.
KE…I think you are great blogger but of late you are turning into a biased opinion writer…You are the Kenyan GLEN BECK and Fox News.. or maybe a Kenyan TEABAGGER..LOL…I Can’t wait to hear your next conspiracy theory of how KENYA is coming to an end…Thanks to the likes of Equity Bank and Transcentury…LOL..But I respect your opinion…Yes its just your opinion…
Dee:
Girl! I’ve always been biased. In fact, I never take the middle ground on anything. Blogs are not like newspapers. They are really opinion pieces and if your looking for balance, then don’t read blogs because they fundamentally display the biased opinions of the author. You’ll find your balance in the comments section (as you have seen here).
You know what is? I’m getting so much information and a picture is beginning to form about what is actually happening and it’s not a pretty picture. I’m actually surprised at how many people are unwilling to accept this reality.
Annon:
I never bashed Kencall. It’s Kencall’s own employee’s who have been bashing that company and anyway, Nesbitt was kind enough to answer a bunch of questions which I sent him and which were posted here, so if his feelings weren’t hurt and he still agreed to answer questions, I don’t know why you are so worried.
The people who are giving me this information are actually people who are well connected to these political actors and to the people who are running these companies. Believe me when I tell you, they are not people who need the money.
However, what they are beginning to notice is a situation that is spiraling out of control with all the corruption and that is leaving a large segment of the population destitute.
I still maintain that when Kibaki goes, a lot of these companies (especially transcentury) are going to have a hard time surviving (unless they get another regime that’ll be friendly to them).
But listen. I feel your pain. I really do. I know you love your country, but those negroe’s are stealing your shit!
Maybe someone can tell me how you do it without stealing. I really, really, want to know. I think that could be an interesting discussion.
Kenyaentrepreneur,
You article sounds like pure speculation. with regard to the chicken farmer, if he wants to get his 2 billion, all he has to do is sell the shares in the open market. Equity is not obliged to buy back the shares.
Kenya is experiencing growing pains..but is is growing. Join the train.
Joe:
Yes, this is true. He could have sold his shares on the open market and I’m not sure (if this story is true) why he didn’t do that, but I suppose in a depressed market, it would be hard to find buyers at a price you wanted. So, maybe that was the reason.
About your point on growing pains. I understand that on the path to development every country will go through growing pains, but what I’m hearing doesn’t suggest a situation where a country is trying to reform in order to create a more equitable society.
What seems to be happening is this entrenchment of a system that has been in existence for 46 years and that is now creating dangerous inequality. That is not growing pains.
So, if one looks at the experiences of India or China, you could see clearly that these countries went through their growing pains as they tried to reform their systems and once they did that, the changes started becoming evident. i.e. they moved towards market economies that valued productivity and work and that rewarded those who engaged in those activities in a more fair manner, which resulted in an expanded middle-class.
So, again, when you have 10 – 15 million people starving, you have to acknowledge that something is just not working. i.e. If you had an honest market economy, jobs would be created and those poverty numbers would start going down and when you don’t see that happening, that should be a warning sign about what is occurring.
Honest market economies produce real goods and real companies and those goods and companies create jobs because people have to produce these goods.
What I’m seeing is a lot of wheeling & dealing with no productivity. i.e. people with the right connections are just looting taxpayer money by being able to get government tenders. So, if we use the case of CMC motors, which is partly owned by the Kenyatta family. CMC, with it’s connections to Uhuru, gets a tender to supply new Passats to all the ministeries. They over-inflate the price of the cars (in order to increase their profit margins) and then they just import them (& I’m sure because of their connections, they didn’t have to pay those import taxes) & they re-sell them to the government at those exorbitant prices; keeping the extra money for themselves. So, you can see the fundamental problem here. You don’t have to make anything. All you have to do is get the government tender and manipulate the prices and since you are not producing anything, you don’t need any new employee’s.
I just can’t understand why we collectively bury our heads in the sand.
For the last 46 years, we have been raped by our so called “leaders” and their associates in just about any position imaginable and we, with the help a properly positioned rear-view mirror, know who they are.
Yet, when someone such as KE decides to bring up some questionable issues, whether wrong or right, we all gang up against them and let our pride sweep our brains away.
During the PEV in 2008, I found the following gem in the Kumekucha blog, which, funnily enough, nobody bothered responding to:
Which brings me to the subject of KE’s post; Equity and Transcentury and the previous posts about Equity. I am not saying that Equity and Transcentury are crooks or what KE wrote is the gospel truth. I myself have been hearing too many stories about them and the connections they have. My duty as a Kenyan, who has on more than one occasion been fleeced by our “leaders”, would therefore be to ask myself “Could there be something there?” All I’m simply trying to say is that every time we have a major scandal in Kenya, the signs were there but we chose, for one reason or another, to overlook them.
We know the people behind Transcentury.
We know they are very well connected to Kibaki.
We know of their connection to the Youth Enterprise Development Fund (YEDF) through their Canadian NGO Enablis (www.enablis.org/Default.aspx?TabID=39 ).
We know of the massive looting spree taking place at the YEDF through Enablis and others.
We know of their connections through East Africa Cables to KenGen (www.transcentury.co.ke/portfolio.asp ) and their buddy boy who heads KenGen.
We know they own a sizable chunk of Equity Bank through Helios Partners (www.transcentury.co.ke/portfolio.asp and http://www.heliosinvestment.co.....nvestments ).
We know Kimunya, as finance minister, gave Helios Partners an unusual exception from any inquiry of who the shareholders are for 9 years (http://allafrica.com/stories/200712170802.html ).
We know of James Mwangi’s history with Trade Bank.
We know Equity bank only started expanding massively when Kibaki became president.
By themselves, the above are in no way an indication that Transcentury and Equity Bank are fraudsters. Yet we see many, many other telltale signs yet we choose not to question any further. We now instead focus on one “chicken Farmer” or the fact that we got a loan from them and ignore the whole point of the post.
Why?
On a side note KE, did you notice the interesting story in Sunday’s Nation (11/01/2009) about the Moi Generals Guns for hire?
http://www.nation.co.ke/News/p.....index.html
ke,
I still don’t know why u keep on deleted my comments.
But I will still coninue to challenge you.. but let my comments last a bit longer.. 12 hour, one day please!! And see how people think of you!
It seems at times that ke can’t take the heat.. the only problem with this post was the speculation without facts.. a conspiracy theorem.
Then for defence you change the subject to your usual ” production” this…uhuru that. Give us facts why you think so of the equity bank.
KE
India is one of the most backward countries in the world. Infact, the living standards in Kenya are better than in India in many places. There are pockets of prosperity here and there but India remains one of the most UNEQUAL societies on the planet.
Can you compare the slums of Delhi and Mumbai with the rich suburbs of those cities???? Oh My God, even our own Kibera is better.
Kagame of Rwanda recently said that a country is made through the sentiment of its people. Its the sentiment KE, the sentiment.
Right now, I support Kenya. Kenya will make it and emerge a stronger and better country.
Maua:
What Heat? I’m more surprised at just how many people are unable to analyze economics.
What evidence do you want? When people are stealing, do you expect them to leave a paper trail? A lot of business is done behind closed doors, which is a big part of the problem.
Annon:
India & China both achieved food security in the 1970′s. No country has ever developed without first achieving food security. Kenya has not yet achieved this. At least in India, everyone is assured of one meal a day. Is this true in Kenya? And please remember that both countries have over one billion people. Do you know how hard it is to develop a country with such a high population? What they have done is quite remarkable! Kenya, with 40 million can’t even do that. So, I wouldn’t be surprised if the slums in Mumbai look worse. They are more people living in them, but at least they have food.
I have no response to your point about sentiment. I don’t even know what on earth it means. If people are hungry will “sentiment” feed them? C’mon.
Chiron:
Your comment was spam blocked for some odd reason and that’s why it took a while to post.
You have done a good job of providing links, which I hope people will check out and read for themselves.
All the companies I have mentioned are simply “regime-based companies” and it’s not about bashing Kikuyu owned businesses, which I think is where some of the anger is coming from.
Moi and his cronies did the same thing for 24 years. Transnational bank is one such regime company. Kestrel Capital (owned by Biwott’s son-in-law is another) and they are numerous others. Afterall, Moi was there for 24 long years.
These guys are not business geniuses. There is a reason they all propped up when Kibaki came into power; just as there is a reason why all those Kalenjin millionaire business men propped up during Moi’s time. They are all using their connections at state house to rape the country of millions and millions and I am being told that the worst is yet to come. In 2011, the stealing will be even more massive because everyone knows that Kibaki isn’t coming back.
Raila Odinga is also in on the game. I”m hearing stories about MD’s of companies complaining about being threatened by his office if they don’t send over suitcases full of cash.
**
I just saw the link to your Nation story. That is very worrisome because all the evidence about the PEV suggested that ex-Kalenjin military officers had helped plan that operation. You can’t evict 500,000 people in 2 days without prior planning.
I’ll have a story on that later; one that many haven’t heard of yet about the violence in 1997 by the Kalenjins and the retribution by Kikuyu’s.
Did I not mention on this blog (a whole two years ago) that 15 years ago Michuki told a group of people that it was going to be war between the Kikuyu and Kalenjins?
KE
There can be no war bewteen Kikuyus and Kalenjins.
Firstly, there will be no war in Kenya.
Secondly, a war in Kenya would involve everybody and not just Kikuyus and Kalenjins.
Thirdly, I stil insist that you thrive on speculation. For instance, when you say that “Michuki told a group of people” – it sounds like mere propaganda.
Who are these people that Michuki told?
Exactly when did he say it?
Where was the venue?
This is the sort of information that you should be providing so that waht you are saying can be corroborated and verified as the truth. Otherwise, you just sound like a bitter person. Sour grapes.
KE,
What analysis…a story about a farmer who could not withdraw Ksh. 2b…You call that economic analyses
Its unfortunate that you think that those who do not agree with you aren’t smart enough for you. They need a crystal ball to see the magic
By the way even in the West you cant just walk into the bank and withdraw such large sums of cash money.. just like that. You can’t even deposit large amounts of cash without raising eye brows..and inviting investigations!
Annon:
I’ll tell you exactly who he told. He told a group of people who had gathered at his sons house for his sons graduation party. Is that enough information for you? C’mon dude, wake up!
And what would you call the tribal clashes in 1991, 1997 and 2007? where Kikuyu’s were specifically targeted, kicked off their land and killed. What do you call that? A shrimp dinner party?
And it’s not sour grapes on my part. I am simply giving you the information that I am receiving and it’s up to you to make up your mind about it.
Kenya is owned and ruled by a small clique of people and it’s not a meritocracy in any way, shape or form and if you are a young person hoping to make it in that system, maybe it’s time to be honest about what you are going to confront.
KE
The tribal clashes in 1991 and 1997 were government sponsored inorder to evict people who were likely to vote against KANU. It was not war between Kikuyus and Kalenjins. The 2007 clashes were instigated by politicians and media people like yourself.
I dont think you know the meaning of the word WAR.
For your information, the so called tribal clashes were executed artficially by hired private armies. Some of the hired goons were not even Kenyans. They were from the Great Lakes region. The private army had Kikuyus, Kalenjins, Luos, Luhyas etc in it. Get the point?????
Back to Michuki. You are still being vague.
Which of his son’s?
Which of his houses?
What date?
What time?
Who was present? Name names.
What exactly did he say?
KE, there is no perfect country. China and India, your blue eyed babies, are very very very corrupt. It is common knowledge.
Kenya is doing alright, as far as am concerned. There is room for improvement but we are doing alright.
Annon:
Either you don’t live in Kenya and are fantasizing or you are just plain stupid.
How can a country where 10 million people are starving (and that number may even be higher)- how can a country like that be doing “alright”?
Come to the ground and you’ll realize that nothing is working here. Electricity blackouts, water shortages, high crime, kidnappings.
Kwenda huko wewe
KE
So Kenya has problems. Is your solution inciting the people to kill one another? How will that solve the problems?
You have to realise that those problems are not unique to Kenya. And Kenyans are working to resolve them and they will do it in the end.
Rome was not built in one day.
What do you mean nothing is working? Electricity blackouts? How many? Water shortages – Kenya is semi-arid. High crime rate – you must be joking; compare that with Mexico city, Los Angeles, Bogota, Baltimore and you will realize that Kenya’s crime rate is not that high.
It is you who is either very stupid or you have your own evil agenda.
But my suspicion is that you are a failure in Kenya and that is why you are so bitter.
Once again, there will be no war in kenya and things will only get better.
Annonymous,ke
Ladies and gentlemen calm down, the world is not ending now.
KE has this habit of lashing out on to people who disagree, call them stupid or something other than smart… just wants to lecture..and just swallow theories. Unbelievable!
KE, tell us more about the chicken farmer who was trying to cash his shares at equity..not at the NSE.
Annon:
You need to address (HUH)who left those comments above, not me. I write under my own name.
Maua:
I want you to talk about some of the issues raised instead of just focusing on me.
If you re-read the story, the chicken farmer was alarmed when money started being taken out of his account to pay off a loan he had taken out. This money was being withdrawn before the terms of repayment were due and without his knowledge. This was the red flag issue (unauthorized withdrawals from his bank account) and it’s what led him to go and ask James Mwangi about what was going on. Thus, the advice that followed: i.e. diversify your investments into different things & don’t put all your eggs into one basket, especially in light of what just happened to you.
For some reason, you are focusing just on Equity, but I also mentioned East African Cables and told you exactly who they were sub-contracting their work to (even giving you the name of the other cable company, which many people have probably never heard of).
You have to be able to analyze the information in it’s totality, otherwise your going to miss the overall point of what is being conveyed here.
I want to add an additional addendum here about Amos Wako because he has now been outed as the government official who has been banned from visiting the U.S.
A few years ago, a banker friend of mine informed me about Amos Wako’s bank accounts in New York City. I was told that Wako had about $100 million dollars sitting in a bank account and I think the bank was either UBS Warburg or Credit Suisse (I don’t quite remember because the story was told to me 3 years ago).
When you have this kind of money, you get the services of a private personal banker and Wako had one (a mzungu banker whose job it was to ensure that Wako, with all that cash, would continue to remain a valued customer of that bank). It was this mzungu banker (who had Wako as one of his personal clients) who revealed this information (because he had just met with Wako the night before and Wako was checking in with him).
I’m pretty sure the U.S. embassy has this information and I was surprised to read that Wako is threatening to sue the U.S. government.
So, let’s put this all together;
Wako is not going to sue anyone because he knows that if he sue’s the U.S. government, two things will happen:
1) The information about his bank accounts will become public because all lawsuits in America become part of the public record (unless you can get a judge to issue an order sealing the records, but unless it’s an exceptional case (e.g. to protect a rape victim or to protect a child) records will not be sealed.
2)If he sues the government, they could go after his bank accounts.
So, I am sure that the only thing on Wako’s mind right now is trying to find a way to move that money out of New York and put it in a safer place where it cannot be frozen by legal action.
Trying to get Kenyans to clearly acknowledge the problems we’re going through and their causes as a first step in solving them is like swimming in molasses – very little return for very great effort.
Oh dear, maybe I shouldn’t have written “molasses”.
I think KE your blog as i have pointed before is becoming too speculative.
The Kenyan economy has faced major challenges but has remained robust even during this tough times.
It is not fair to paint individuals black without providing any evidence in the form of documents or even bibliography e.t.c
Kenya is now considered an emerging nation from a least developed status.
We are the world leader in Mobile Financing and Britain here is thinking from moving from the Debit/credit card system to Mpesa like systems.
The government under Kibaki has developed the infrastructure in a way a never thought possible.
Corruption may be there but its more like insider trading which is common everywhere even here in Britain which has been caught in a number of amazing corruption scandals.
1.BAE Scandal
2.Mps Scandal
3.Equatorial COUP Guinea scandal
Lastly Barclays bank is not the heaven you think it is. It recently had to be bailed about secretly by the American tax payer.
Lets develop our Banks as it is we the shareholders who own a piece of Equity
Otherwise please step up and focus on building Kenya not shooting us in the foot all the time.
John Karanja:
Please explain to me what exactly the above statement means.
My piece is not about looking at countries that have zero corruption. Those places do not exist because human beings all over the world are greedy. That is not the point of the piece.
The point of the piece is to highlight for you how massive corruption can deplete a country and leave large segments of the population destitute and hungry. Britain, even with it’s corruption, does not have 25-30% of it’s population facing hunger issues.
So, comparing the corruption in America or England, to the corruption in Kenya is like comparing apples and oranges.
KE
The UK is broke. They are having to print another £25 Billion to pump into the economy on top of the £75 Billion they have printed and pumped since October 2008!
Who would have thought the UK would resort to printing money to keep afloat??????
I understand they would have been declared bankrupt if they had not done so!
So there……
Annon:
Britain is printing; America is printing; but guess what? when push comes to shove, people will still flock to those countries with their money and will still opt to live there. Why? because of a variety of factors:
Efficiency
Rule of law
Democracy
low crime rates
good infrastructure, etc, etc…
General quality of life issues that make a place livable.
I was having dinner at a restaurant last week and ended up talking to a woman from India who was married to a man from Brazil. Now, both of these countries are considered to be emerging market economies (i.e. the BRIC countries: Brazil, Russia, India & China).
So, this woman’s husband moved back to Brazil to work and he said it’s just too slow for him and there’s too much crime and he’s moving back to America.
She herself said the same thing about India. They work enormously long hours & it’s a mandatory six-day work week, but even they aren’t operating at the same level of efficiency.
Eventually, these BRIC countries will catch up with the west, but they’re not there yet.
So, John Karanja’s point that Kenya is an emerging economy is totally false. Absolutely, totally false.
In fact, I would put other African countries way above Kenya, especially those oil producing countries like Angola and Nigeria. South Africa of course, is way ahead of everyone else in Africa because that’s a pretty advanced economy.
And now, I”m reading that Tanzania, with it’s huge gold deposits is really going to take off, especially as the dollar continues to lose value (because of the excessive printing) and as people around the world continue to hoard gold.
So, in conclusion, my main point is that the corruption is creating dangerous inequality and dangerous poverty, which will eventually lead to an explosion of violence in Kenya. At this point, it’s no longer about “if”; For me, it is now about “when”. I’m not sure if the explosion will come in 5 years, or in 2012 or in ten years; I just know it’s going to come.
** BTW – if you look at all the countries I have mentioned above, they all have one thing in common: either they are producing real goods like cars, aeroplanes, medicines, etc, etc; or they have huge deposits of commodities that are in demand around the world (oil, gold, etc, etc).
That’s why I keep saying that the wheeling & dealing culture in Kenya is not going to grow that economy. You cannot build a sustainable economy on government tenders where you produce nothing, but just get a tender & import all your goods.
KE
Your last 2 comments of yours have been largely correct and the calibre i expect from you.
However i still insist Kenya is an emerging nation for 2 basic reasons.
Impressive infrastructure advancements we have 3 towns/cities with more than 300,000 people this is comparable to Britain has about 8 such cities but a 1000 year headstart.
Granted there are still problems in this cities but the evolution process has been really fast.
100 years ago we were in a SUBmedieval existence not able even read and write. This has got to be the fastest progress on earth.
Secondly and more related to this point is we have a relatively good number of people educated up to degree level. 100,000 such graduates ever year. This is critical and no need for me to explain further
Also Kenyans unlike other Africans have a knack for forming social movements(chamas) such as your own. This combined with technology such as mobile phones,blogs etc is developing from a bottom up approach in the pyramid.
This is not being factored into the economy which most people believe is actually double the estimated size.
P.S. Equity is a social movement bank i.e and I am a member.
John:
The population of a city doesn’t tell you much about it’s economic viability. If the 300,000 people you mentioned above are dirt poor, you cannot compare it to anything in Britain.
Kenya is not an emerging economy (factually, statistically or any other way that you want to look at it). It is simply not. I’ve already given you a list of the world’s emerging market economies and I’ve thrown in South Africa as the lone African country on that list, but that’s it.
Many Latin American countries, which are far richer than Kenya are not even on that list.
And like I’ve said before, without food security, a country should not even be talking about anything else.
You must achieve food security first because it is the one thing that will keep people relatively calm while you work on building the other long-term things that will bring sustainable economic growth.
John karanja
Thanks for bringing sobriety to this discussion.
What Kenya needs right now is people who will put their money where their mouth is. There is no point of moaning all day.
The point is – what can you do for your country?
You can be a leader even in your local community and change starts with yourself.
KE
I have had the opportunity of travelling widely in Africa, Europe and Asia. I still insist that Kenya is on the right path and it is way better that many other countries.
But then there are people like you who are determined to be defeatist.
On wako, KE was right on the money 3yrs ago…I read that..”permanent smile”..because he knew what he has in newyork…the west knows how to use carrots/sticks on these guys..at least publicly this time…why do you need $100million for, and not even ” feel philanthropic enough”…In the US People with that kind of money run huge charitable organizations for causes dear to their hearts.
The fool even stole titles from deceased clients?
Annon:
I’m not quite sure how you can say (with all honesty) that Kenya is on the right path. Based on what?
You can think what you want to think, but at the end of the day, you simply cannot ignore those poverty numbers and the widespread hunger issues.
Then, add in a growing population of young people who are not interested in farming anymore, but who would rather move to Nairobi, live in slums & struggle to find an office job) and you can see a coming problem: A growing, young, population, in a country with low food production rates(because of the lack of farming) and the problems are just going to get worse.
The solution is to get a very strong man (& it will be a man) who will come in… and out of his own sense of morality, will simply say enough is enough and he’ll fix that country, but I don’t see anyone (presently) who can do that. So, that society is going to have to re-work itself and it’s not going to be pretty.
John Karanja,
I wonder if you’ve ever spend time with the 100’000 graduates who leave with degrees every year and have no jobs, no income, and no future. The same graduates who head to Nairobi to fill up the slums to eke out a living.
I have looked into the eyes of so many such graduates and have seen the despair of no future. When I go upcountry, I see my own cousins and neighbors with the same vacant look in their eyes. There are simply no jobs and future for them and, what is worse, they know it.
Now, you and I can comfortably sit here and talk about Kenya growing (which the governments own analysis disputes). In case, for example, we don’t have anything to eat at home, we can opt to go for take away. This choice is simply not available to a majority of Kenyans. According to them, things are actually worse and there seems to be no reprieve coming soon. Example; just ask about anyone old enough to remember how life was in the ‘70s and ‘80s. They will all tell you it was great and things were affordable. A then KPTC salary of KES 3’000/- was comfortable for a family to enjoy life for a whole month. Now compare a current Telkom salary of KES 25’000/- and see what I mean. Heck, even compare it to a current salary of 50’000/- for a family of four.
The evolution process you write about is very true. But it’s for a tiny minority of Kenyans and pyramid base is widening, for an example, see http://www.nation.co.ke/busine.....index.html and http://allafrica.com/stories/200910291078.html. Outside the cities and towns, the majority live the exact same way as our forefathers did. Actually, they’re worse off as they are now collectively starving. They honestly don’t give a hoot about blogs, Seacom, DSTV, and all the other modern things a minority takes for granted. Do you sincerely believe that a majority of Kenyans are better off today than at independence?
I don’t find myself to be a defeatist, merely a realist about Kenya. Yes, I do want Kenya to grow as it should but it can only be achieved without the massive corruption. Looking at illusions or ignoring the problem will not help us at all. Proportionally, more of our population is poorer today than ever before. We must be courageous enough to tackle the truth, no matter how ugly it may seem and only then can we chart the way forward. The right path is not chopping each other into mincemeat as we did in 2007/2008. We need a leader who will be able to take us to the Promised Land and I, for one, will back him/her to the hilt.
Remember, Bob Marley once sang “A hungry man is a angry man”.
Chiron:
It is amazing to me how many Kenyans still are unable to make the connection between the massive corruption and the extreme poverty, which surrounds them.
Someone above said I kept harping on about production, but I did it for a reason. i.e. without production, you simply cannot create wealth because producing goods would require you to have employee’s who’d put those goods together for you (i.e. pack them, design them, etc, etc); and that’s why production creates jobs — because it requires manpower.
Think about it for a moment: The Moi family is worth probably about $1 billion dollars. How is that possible in a country with a GDP of only $30 billion? What is the Moi family producing? The answer is nothing at all. They are just taking; extracting and hiding their loot in foreign countries.
When Amos Wako takes $100 million dollars, he is not creating jobs or building a company. He’s just taking.
Do you know how hard it would be to make $100 million dollars anywhere in the world? You’d really have to (not just work very hard), but produce or make something that was valuable to society; i.e. something that people are willing to pay for because it adds value to their lives. This is how people in the west and in Asia are getting richer. They are producing goods that we need(cars, fridges, cell phones, computers, etc, etc) and because these goods make our lives easier, we are willing to pay them in order to get them.
However, people like Wako, Moi & Kenyatta are not making anything that anyone wants or even needs. They just take and eventually a point is going to arrive whereby the country is left with nothing and that’s when the explosion will occur.
Yo,
Can you imagine the security situation in Kenya is so bad that ordinary businessmen find it better to deal with the burglars and thieves themselves without the police. The situation is that bad…
Hebu someni hii article…. you see for yourselves…
http://www.standardmedia.co.ke.....9&
I know these things happen in Mexico and Brazil and the like but hata hivyo… This is a very bad trend we are seeing here….. When business men and even lecturers have to cooperate with Kidnappers… this means only one thing… The Police or AP or whatever they call themselves are absolutely inffective and unable to cope with this Security crisis which will get worse and worse when this damn government continues to do nothing to decentralize its activities.