President William Ruto has stirred the hornet’s nest with a public declaration effectively expelling giant Indian industrial conglomerate Tata Group from a long-standing soda ash mining concession at Lake Magadi.
The edict, pronounced at a political campaign rally in Kajiado County, has generated heated debate, with many seeing it as reckless populism that damages Kenya’s quest for foreign investment.
Critics interpreted it as executive fiat in contempt for land and property rights, defined regulatory safeguards and ongoing proceedings in court. Some even saw it as a sinister attempt at forceful grabbing of private assets.
The Magadi issue must, however, be viewed in the proper context, particularly from the historical perspective of unjust colonial-era land leases and mining concessions. There are many other land holdings in different parts of the country that have caused occasional rumblings, and which sooner or later could snowball into serious discontent. Those include vast tracts of land in Kenya’s most fertile regions whose leases to foreign, mostly British, corporations were left untouched at independence.
In Kericho and Bomet counties, large scale tea plantations remained under control of multinationals such as Brooke Bond/Unilever, James Finlays, George Williamson and others. There were also the Teita Sisal Estates in Taita-Taveta, the extensive pineapple plantations in Thika at the intersection of Kiambu and Murang’a counties owned by Del Monte; and in the same region the massive acreage held by Kakuzi for livestock, coffee, timber, avocados and other agricultural produce.
Also a cause for disquiet are the expansive ranches in Laikipia, many converted to private wildlife conservancies, which to date stand out as holdovers of a colonial expropriation that reserved vast tracts for a tiny colonial aristocracy, while millions of locals were pushed to the fringes.
In that regard, Magadi cannot be revisited in isolation, but as part of a more deliberate national effort aimed at settling historical injustices that have been allowed to fester more than 60 years into independence.
There were probably good reasons why the founding fathers who crafted Kenya’s freedom from British colonial rule left intact those agreements. Although freedom was hastened by the Mau Mau rebellion, it ultimately was attained through negotiated settlement rather than revolution. The founding fathers, in their wisdom, or lack of it, decided to leave intact land concessions that made the bedrock of Kenya’s economy of the time.
It is long overdue that issues set aside in the justified haste towards an orderly transition to independence, one that did not result in chaos and economic collapse, be looked at afresh. The problem is that President Ruto’s edict on Magadi comes across as a reckless political campaign pronouncement rather than a sober and considered solution.
It was during his ascension to power in 2002 that President Mwai Kibaki famously declared an end to the era of roadside policy pronouncements, in direct reference to the ways of his predecessor Daniel arap Moi. The 2010 Constitution reinforced limits to dictatorial decrees with provisions requiring that presidential decisions be backed by signed Executive Orders. Roadside decrees, especially on the political campaign roadshows, are back with a vengeance under President Ruto.
It does not help that his move on Magadi is undermined by a series of inconsistencies and untruths. First, we are told that the Tata Group has been kicked out and will be replaced by another investor, suggesting that another player has already been tapped through an opaque and secretive process unknown in law.
When the s**t hits the fan, the president changes tune and says advertisements will be published in the search for new investors. He also lays out conditions that investors must meet, including demands for local glass manufacturing and other value-adding processes.
But this comes with the lie that 100 per cent of the Tata Group’s soda ash output is exported raw. Kenya glass manufacturers already source 90 per cent of their raw materials locally, and a large part of that comes from Magadi. Other local users of Magadi products include chemical companies, soap and detergents manufacturers, food processors, textile and paper industries.
A welcoming environment for investors, whether foreign or local, cannot be built on a regime of uncertain legal and regulatory safeguards. The threat of expulsion by presidential fiat, the appearance of unlawful expropriation, and covetous eyes from local politicians send red flags all round.
One of the world’s most powerful industrial conglomerates is unlikely to go out with a whimper. Tata’s fightback will extend to the most powerful boardrooms and institutions across the globe. It will only be a matter of days before President Ruto is forced to retreat.
Mr Gaitho, an independent journalist, is former NMG Managing Editor for Special Projects. [email protected] .
