Blog Archive

Thursday, October 18, 2012

Why has South Korea overtaken Kenya? Because its rulers can limit their greed

Original Source:

Why has Asia boomed in recent decades, while Africa has sunk into penury?
The pithiest answer is a joke I first heard in Nigeria. An African and an Asian make friends at Oxford before becoming politicians.
Years later, the African visits the Asian and is impressed by his mansion, with a Mercedes-Benz in the drive.
"How can you afford this?" he asks. The Asian points to a majestic highway outside. "See that road?" he says with a wink. "Ten per cent."
Later the Asian visits the African's home - a palace with a dozen Mercedes-Benzes.
Anticipating the question, the African says: "See that road?" The Asian sees only bush. "100 per cent."
This is closer to the truth than many on Tony Blair's Commission for Africa would care to admit. East Asia has grown richer in spite of corruption because its rulers felt bound to not steal too much.
They may have skimmed off a bit but they did build the road. Africa's rulers did not.
Consider the cases of Kenya and South Korea. In 1960 South Koreans were, on average, poorer than Kenyans. They are now 25 times richer. What can account for this extraordinary divergence?
It is unlikely to be the legacy of colonialism. The British were disrespectful of Kenyan culture and crushed the Mau-Mau uprising with great ferocity. The Japanese were far more brutal, banning Korean culture and enslaving perhaps 100,000 Korean girls to work in military brothels.
Then, after the Second World War, Korea endured a civil war in which a million people died. Kenya had no comparable trauma.
Some of the differences must be linked to education. South Korean children thrash nearly everyone at maths and science. Kenyan kids do not.
That is not because Koreans are more clever. A more plausible reason is that Korean children do lots of homework. In the early 1990s I lodged with a Korean family in Seoul. The two teenage boys studied hard but never hard enough for their mother. And the father told the elder one that he had to study engineering, whether he wanted to or not, because that was the way to a good job.
Contrast that with Kenya's Masai tribe. Rural Masai send their cleverest sons out to herd cattle, a high-status occupation, and their dimmer children to school.
Given the demands of the modern world, you might think this unwise. But in a way it makes sense. In a meritocratic society such as South Korea, education brings rewards. An engineering degree means a good job.
But in Kenya, those with the power to hire tend to employ members of their own tribe, no matter how lazy or incompetent they may be. So the pay-off from diligent study is less certain; the country has legions of jobless graduates. Korea has tribal problems too. Those from the south-western region of Cholla suffered serious discrimination until quite recently. But there was nothing on the scale taken for granted in Kenya.
The country's first president, Jomo Kenyatta, was from the Kikuyu tribe, who remember him as the father of the nation. Others remember him as the man who gave all the plum jobs to Kikuyus.
Under his successor, Daniel arap Moi, the tables were turned. His Kalenjin tribe were first in line to put their fingers in the public till.
The man who ousted Moi in the elections of 2002, Mwai Kibaki, promised to end the corruption culture. At first he delivered, sacking half the judiciary and warning police to stop robbing motorists.
But then Mr Kibaki grew sick and the Kikuyu cabal around him set about looting the country unchecked. The symbolic end to the anti-corruption drive was when the widely respected anti-corruption minister, John Githongo, fled to London in February, fearing for his life.
Even before then, traders in Nairobi's biggest slum market were telling me that the main reason business was bad was that the police kept confiscating their stock and demanding bribes to give it back.
The difference between the two countries is mostly attributable to politics. Kenya's rulers are parasitic. They enter politics to get rich and care little about the little people.
South Korean governments, though far from perfect, have consistently made economic growth their top priority.
If you doubt that politics matters, consider the case of North Korea. Only half a century ago it was culturally identical to the South - and slightly richer.
After two generations of homicidal Marxism, it is probably as poor as Kenya, although no one really knows because publishing honest statistics there can put you in a prison camp.
• Robert Guest works for The Economist. His book, The Shackled Continent: Africa's Past Present and Future, is out in paperback this month.

Friday, October 12, 2012

NIC Rights Issue - 2012 - Shenanigans?

What an interesting but odd (& worrying) tidbit about the NIC Rights Issue that was forwarded to me:
What is or has the CMA done after they were informed?

NSE websiteNewspapers
Total Number of New Shares Accepted Under Entitlement 85,988,640 85,509,866 478,774
Total Value of New Shares Accepted Under Entitled [KShs] 1,805,761,440 1,795,707,186 10,054,254
Take Up Percentage87%87% -  
Number of Untaken (Lapsed) Rights 12,735,751 13,214,525 (478,774)
Total Number of New Shares applied for Under-application for Additional Shares 248,318,371 248,324,971 (6,600)
Total Number of New Shares applied for Under Entitlementand Application for Additional Shares 333,834,837 333,834,837 -  

The table/results published in the Newspapers (Daily Nation of 11th Oct 2012 Pg 22, The Standard of 11th Oct 2012 Pg 13).

So who got the 478,774 shares at the last minute?

Monday, October 08, 2012

Abu Dhabi - Next destination for Kenya Airways?

Interesting tidbit from Reuters.

KQ's 2nd largest shareholder [& technical partner] is Air France-KLM therefore the recent agreement between AF-KLM "Air France-KLM, Etihad, Air Berlin plan partnership" probably means KQ may reduce flights to Dubai in favor of Abu Dhabi to take [code-share] advantage of Etihad's worldwide connections to Australia, China, North America & the Far East.

Etihad flies to Nairobi & a code-share for ET passengers to (Southern, Eastern, Central, Western) Africa may make sense for both parties. I expect Etihad will not give up major destinations like Jo'burg & Lagos but let KQ handle smaller destinations like Entebbe, Kigali, Kinshasa, Luanda, etc

Saturday, October 06, 2012

Kenya MPs National Anthem

From: "Rawser"

Kenyan MPs remix of the national anthem:
Politicians of all persuasions
Strip this our land and nation
Fortunes motivate us and keep us
May we steal with impunity
Dodge taxes in unity
Plenty be sourced within our dockets
Let all politicians arise
With scams both wily and foolproof
Eating be our earnest endeavor
And our cake-stand of Kenya
Heritage of plunder
May we fight forever to perpetuate
Let parties with one accord
In common greed united
Bankrupt our nation together
May the agony of Kenya
The fruit of our behavior
Remain hidden from our 2013 voters