Counties have been challenged to focus on productivity in order to lift the lives of locals from poverty and increase economic activity at the local level.
Speaking during a Counties competitiveness webinar, Dr. David Ndii explained that competitiveness can be looked at in terms of cost or price, value, and productivity. Being cost competitive is often achieved by acquiring cheap labor, which is undesirable. For value, it’s about considering things like experimentalism, like in tourism which allows you to charge a premium.
Productivity is where Kenya and counties specifically can really make the difference, he asserted. “Kenya is the largest exporter of tea in the world. We also have the highest yield per acre, at 4500kgs. Sri Lanka who is second produces 4200kgs per acre. On the converse, we do very poorly in producing sugar, even within COMESA. While we produce 25 tons per acre, the sugar is slowly maturing and has lower sugar levels, countries like Sudan are producing 40 tons per acre”, he remarked.
Laikipia Governor Nderitu Mureithi was of the view that enterprise is what will change the underemployed in the country.
The meeting was meant to discuss what it takes to position counties to achieve economic competitiveness.
Dr. Ndii added that in a study conducted in Laikipia, they found that a farmer could get sh25, 000 per acre planting maize while a pineapple farmer could get sh180, 000 also from an acre. “We must move to high productivity, high competitiveness across products”.
Dr. Jane Kiringai, the Commission on Revenue Allocation (CRA) Chairperson said that it would be ideal to examine the productivity of staff. She said that in the seven years of devolution, counties have received sh1.7 trillion but three-quarters of it go to salaries. But this is partly because some counties inherited municipal councils that had staff, the majority of whom are unproductive and doing away with them is difficult since they are permanent and pensionable.
“Mandera County did not inherit a Municipal Council, so its wage bill is only 20 percent of their total expenditure. On the other hand, Taita Taveta is 55 percent, since it inherited one”, Dr. Kiringai explained.
However, Kisumu Governor Prof. Anyang’ Nyong’o was of the view that the high wage bill should not be viewed negatively because the functions of counties are service-oriented, which means people will be hired to deliver them.
“Economic growth is incremental. To improve productivity on what people are already doing is a sure way of growing”, asserted Dr. Ndii.
Dr. George Njenga, the Strathmore Business School Dean challenged the Governors to also consider how Kenya can tap into certain global value chains. “We have a five billion tons consumption market of avocados in the world. We need to identify these opportunities and train the skills required on the job to make a difference”, he said.