Kenya is a nation that has plunged into unreasonable debt and many economists are warning of a possible economic crisis that may resemble that of Sri Lanka. You may be wondering why Sri Lanka acts as a point of reference. Well, keep reading.
Sri Lanka has been hit with the worst case of economic crisis ever experienced on the planet. The nation is amidst harsh times and its citizens cannot afford food, fuel, medicine and electricity, to mention but a few. The country has a 12-hour power cut policy, so as to ensure that the little energy they have can support the country for a long time to come.
China has been blamed for playing a key role in the collapse of the Sri Lanka economy. How? The Chinese government has a tendency of being very generous to third world countries, and in the process, developing countries such as Sri Lanka and Kenya etc., fail to pay up the loans and end up being economically leveraged by the Chinese government.
In simple terms, Sri Lanka was now under the mercy of the Chinese government. However, upon further research into the Sri Lanka-Chinese relationship, it was established that the loans from China only accounted for 10% of the problem in the country. Statistics exposed that Japan had loaned the nation a higher amount than China.
Further research exposed that the nation had a tendency of implementing policies that injured the economy, far from the intended purpose. The president of Sri Lanka at the time, tried to salvage the economy by banning importation of fertilizer, urging the local farmers to depend on the locally produced fertilizer.
The nation experienced a major drop in their farm produce exports and total yearly revenue generation by the country dropped, to a point where the only solution was to borrow another loan on top of the already existing ones. The country’s situation got worse. This phenomenon has been described by the USA as the debt-trap diplomacy.
How Does This Relate to Kenya?
The average boda-boda price has risen by 40% in the past one month, due to the scarcity of fuel in the nation. Food prices in the country have sky-rocketed, students are finding it hard to buy books to write in and the average mother has had to reduce the number of meals that use a substantial amount of cooking oil.
Despite the government trying all means possible to salvage the economy, it is evident that their efforts are proving futile as the days go by. Politicians aspiring for leadership come 9th August are busy promising Kenyans that they will rescue the situation, but intelligent minds know better. Economists understand that the situation has a good chance of worsening than improving.
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Basically speaking, Kenya is sharing the same path with Sri Lanka, and the only difference between the two nations is time. Kenya is riddled in debts from China, USA, UK and many other already established nations and since we are unable to pay Caesar, we have to dance to his tunes. This is why we cannot claim that the Russia-Ukraine war is not impacting the country. As a matter of fact, the situation is not nearly as bad as it should, or rather, as it will be. If you doubt this, ask Dj Lapoze.
The mainstream media will not tell you that what we are experiencing now is as a result of policies that has Kenya implemented. One of the policies was use of renewable energy, signed back in 22nd April, 2016, in the Paris Climate Change Agreement. Despite this move being good for environmental preservation, the Kenyan government did not realize that the other countries that implemented the policy had the ability to sustain themselves on renewable sources of energy, unlike us.
This policy has had a detrimental effect that was not anticipated. Nowadays, power shortage is rampant in most parts of the country, mainly in regions outside Nairobi and other metropolitans.