The European Union – East Africa Community Trade Agreement: EPA’s Hard Sell
Category: International Trade
By: Edwin Njoroge,
Introduction
Economic Partnership Agreements, otherwise known as EPAs, has been a thorn in the East African Community’s foot since its inception on 23rd June 2000. This is because of the conflicting stance taken by individual leaders of the East African countries, as to the benefits or losses their respective countries stand to accrue from the agreement.
Not only have we heard from the leaders of the East African Community, voices have been added from various stakeholders such as Legislators and Policy Makers, Civil Society Organization, the Private Sector and the Donor Community on the consequences of signing or abstaining from the agreement.
So far, Kenya and Rwanda were the only countries to have signed the agreement as of September 1, 2016. Tanzania, rejected the deal while Uganda stated that it would only sign the deal after fully studying it. Burundi, committed to signing the deal.
Kenya has attempted to address the issue diplomatically by engaging its fellow East African counterparts in what seems to be a futile attempt to convince them to sign the agreement. Pundits argue that refusal to sign has major ramifications on Kenya’s economy, more specifically the agricultural sector.
In this article, we shall give a background of the EPAs trade agreement, explain its relations to East Africa, show its current status with regards to East Africa, consequence to Kenya on the failure of the East African Community to ratify the agreement participate and propose a viable way forward for Kenya.
Background to the Economic Partnership Agreements
International trade is important as it avails goods and services otherwise not produced locally. It is also an important means of fighting poverty. This is because producers of goods and services, through availing their products to the global market, are able to receive payments for their produce, which gives them a source of income. It is also credited for availing options to consumers in a market. That is, an individual has an array of products he/she can choose from between the Chinese products or European products within the same market.
Economic Partnership Agreements are a scheme to create a free trade area between the European Union and the African, Caribbean and Pacific Group of States. The main objective of EPA is to support and facilitate trade between the two blocks and to eradicate poverty.
African, Caribbean and the Pacific Group of States were largely former colonies of European Countries. This means that they provided cheap labor and raw material for the industrialization of Europe. Upon independence, the dependency of Europe on these countries for raw materials did not end. However, the former colonies noted that the relationship was one sided. With the advent of independence, the former colonies were emboldened enough to demand greater control of their economies which resulted to the signing of the Lome Agreement.
Lome Agreement
The European Union (EU) offered to reorganize trade to help its former colonies by formulating a trade partnership through which the relationship between Europe and the newly independe
Under this agreement, goods and services from the ACP countries—mainly agricultural goods and minerals which were exempted from tariffs and duties—enjoyed special access to the EU markets. However, the free access did not apply to products competing with EU agricultural products. For such products, access was based on a quota system, where products entering the EU market would be limited, mostly by quantity. On the other hand, goods from the EU were not granted such access in the ACP countries’ markets.
Even with all these provisions, the ACP countries did not fully benefit from the agreement as some of the provisions of the Lome Agreements were disadvantageous to them. An example was the “Rules of Origin”. The Lome Agreements lasted for 25 years and expired on February 29, 2000.
One of the greatest cause for its collapse was because some countries were not happy that the EU was allowing free access to ACP products as this amounted to favoritism. They, thus, challenged this arrangement and it was found that this preferential treatment which was a system of waivers amounted to derogations from the World Trade Organization rules. This called for a re-arrangement which led to the The Cotonou Partnership Agreement.
The Cotonou Agreement
The Cotonou Agreement, otherwise known as the EU-ACP Partnership Agreement, is a treaty between the European Union and the ACP countries. It was signed in June 2000 in Cotonou, Benin, by 78 ACP countries.
The defining features of this agreement were, among others:
i. Reciprocity: meaning that market access would be provided by both parties. In this case, the ACP countries would have to open up their markets to EU exports;
ii. Differentiation: introduced in recognition of the varying needs and levels of economic development of the different states. Each ACP country was allowed to offer market access when they were ready;
iii. Regionalism: the agreement would be between the European Union and a defined group of countries such as the East African Community (EAC), ECOWAS or SADC, among others; and
iv. Conformity to the World Trade Organization System (WTO is the successor of the aforementioned GATT system. It is a multilateral agreement between nearly all countries of the world on trade issues)
In general, it covered the following issues trade in goods, agriculture, fisheries, economic and development cooperation, institutional arrangements and dispute settlement mechanism.
East Africa Community European Union EPAs Context
Member states of the east African community have never found a common ground as to whether they should ratify the agreement. To date, Kenya is the only country in the region that has deposited instruments of ratification. According to the Kenyan Government communique, the ratification is expected to enable Kenya enjoy access to the European Union market.
However, based on the principle of regionalism which is explained above, Kenya may not really gain from the ratification as it needs to join the agreement as part of a trading bloc. The rest of the member states have in the past requested for time to study the agreement in order to reach a conclusive agreement. Such sentiments were well captured in the Joint Communiqué: 19th Ordinary Summit of Heads of State of The East African Community.
Reasons have been given by members of the abstaining from ratifying the agreement include:
a) Market Access
By 2033, the East African Community is expected to liberalize up to 82.6% of all its imports from the European Union. In as much as this has been agreed, members of the East African Community feel that the level of liberalization is too high. It raises the likelihood of having negative implications on livelihoods, employment, shrinking of the policy space, and on efforts to industrialize and integrate meaningfully into the global economy. This extensive liberalization is based on the argument that the region needs cheap intermediate goods to be used as inputs in the production processes thus enhancing competitiveness; and finished products whose availability at lower costs is deemed to have consumer welfare-enhancing effects.
b) Agricultural Subsidies
The EU runs a subsidy program for its agricultural industry called the Common Agricultural Policy (CAP). Launched in 1962, the subsidies program makes it easy for European farmers more competitive as compared to other farmers. Such subsidies are a violation of the WTO treaty. Their effects would be to place such a relatively strong and competitive industry against a weak, yet very sensitive East African industry. This is expected to hurt the respective East African economies.
c) Duties and Taxes on Exports
Under this clause, the European Union would disallow the EAC partner states to impose new export taxes or increase existing ones unless they can justify special needs with regard to revenue, food security, or environmental protection. Export taxes are an essential development tool that can be used in promoting industrialization and employment creation, and in creating incentives to add value to local products rather than exporting them in their raw form.
d) Rules of Origin on Agricultural Products
Rules of origin are the criteria needed to determine the national source of a product. Their importance is derived from the fact that duties and restrictions in several cases depend upon the source of imports. The EU would like EAC to extend flexible rules of origin on agricultural products, despite the fact that these products are classified by the EAC as sensitive products to the EAC Partner States.
The EAC maintained a common position that the outstanding specific rules of origin should be considered as part of the sensitive agricultural and agro processing products and stringent rules should be applicable as a reflection of the spirit of the sensitivity of these products to EAC Partner States.
e) Most Favored Nations (MFN)
Under the World Trade Organization agreements, countries cannot normally discriminate between their trading partners. If a country chooses to grant another a special favor (such as lower customs duty rate), it has to do the same for all other WTO members.
Under this provision, the EAC is obliged to extend to the EU any more favorable treatment resulting from a preferential trade agreement with a major trading economy/country.
The East African Community states that this principle in the agreement will undermine the prospects of South-South trade which the EAC is aspiring to promote. In addition, the clause is contrary to the spirit of the World Trade Organization (WTO) Enabling clause that promotes special and differential treatment for developing countries and South-South cooperation.
Anticipated Impact of EPAs on Kenya
It is feared that liberalization and the provisions on duties and taxes will hurt the most important sector of Kenya’s economy. This is the agricultural sector. According to the Food and Agriculture Organization of the United Nation, this sector is key to Kenya’s economy, contributing 26 per cent of the Gross Domestic Product (GDP) and another 27 per cent of GDP indirectly through linkages with other sectors. The sector employs more than 40 per cent of the total population and more than 70 per cent of Kenya’s rural people. Agriculture in Kenya is large and complex, with a multitude of public, parastatal, non-governmental and private sectors.
The sector accounts for 65 per cent of the export earnings, and provides the livelihood (employment, income and food security needs) for more than 80 per cent of the Kenyan population and contributes to improving nutrition through production of safe, diverse and nutrient dense foods. The sector is also the min driver of the non-agricultural economy including manufacturing, providing inputs and markets for non-agricultural operations such as building/construction, transportation, tourism, education and other social services.
Liberalizing agriculture in Kenya placing it in competition with the subsidized products from the EU could hurt the economy and exposed the very vulnerable in the society. The very vulnerable in the society are farmers.
Not only will the policy of liberalization affect the agricultural industry through direct competition, it is anticipated to lead to dumping of agricultural products which will have a far-reaching implication on Kenya’s agricultural production and agro-processing sector. Many of this negative effects are anticipate to manifest in the future.
In spite of the above negative implications, in the short term, Kenya may reap several benefits of an EPA. The most fundamental one is that there will be no quotas or duties on exports into the EU, thus allowing local producers access to a significantly wider market. The EPA will also enhance and boost trade between Kenya and other regions in the world. Two of the sectors that stand to gain the most is the textile industry and the horticultural industry.
Failure to ratify the agreement makes Kenya loose the EU preference. This will mean that Kenya will be treated as a developing nation, which it is, unlike the rest of the East African nation and thus attract a 10 percent tariff on all its goods entering Europe. As a consequence, this would mean that the majority of products that are currently produced will be put at risk due to tariff elimination in the EPA, and the EU being more competitive, producers will lose market share to EU imports as well in home markets and other EAC markets.
Conclusion: To Ratify or Not To Ratify
It is important to note that trade liberalization is generally good and it has led to further growth of trade internationally. Advocates for trade liberalization point to a growth in global economy which is argued to have raised the standard of living. However, in reality, competition is usually good when rules laid down create and maintain a level playing field.
The primary benefit of the EPA is that the horticultural industry will continue to enjoy preferential access to the EU. Another benefit is that the EAC members will receive aid from the EU to improve their trade infrastructure, which will address some supply side constraints and enable compliance with standards and technical regulations in export markets.
On the other side, the United Nations Economic Commission for Africa (UNECA) states that if the EPA is signed, local industries will struggle to withstand competitive pressures from EU firms, while the region will be stuck in its position as a low value-added commodity exporter . It is also argued that the liberalization measures proposed under EPA will result to lower tariffs which will translate to lower revenue for the government.
The rules as set in the agreement are not alive to the inequalities by the economies of the East African States as compared to the European as manifested especially in the agricultural and manufacturing sector. In light of recommendation from leading organization and the analysis above, a refusal to ratify the agreement and returning to the table for a renegotiation is important, in order to address the above short comings that could, in the long term, cripple Kenya’s agricultural sector.
Recommendations
The Kenyan government needs to tarry in its quest to engage in a diplomatic charm offensive aimed at securing the ratification of the other East African states and further engage stakeholders in order to properly grasp the consequences of ratification of the agreement on the economy. This is in light of the asymmetries that exists economically that tilt economic power to Europe.
Prior to engaging stakeholders, it is important that the leaders of the East African Community meet and structure a frameworks for consultations with various players within the industry which includes farmers, communities and the larger private sector. After establishing the framework, and engaging stakeholders, then can the members of the East African Community meet to discuss areas they enjoy a comparative advantage and reasons some countries and experts are reluctant to ratify the agreement. This will give countries such as Kenya an in-depth knowledge and appreciation of the reason its counterpart’s refusal to ratify the agreement.
The leaders can take advantage of the principle of regionalism by returning to the negotiating table as a bloc, armed with the knowledge of the areas they enjoy a comparative advantage and leverage on it. During the renegotiation, they can also confront their counterparts on issues posed in the agreement that expose the vulnerabilities in their economies.
In case of a failure during negotiations as a regional bloc, Kenya could seek to engage the EU independently without its EAC counterparts in order to secure its economic interests, especially those of the flower sector.
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The European Union – East Africa Community Trade Agreement: EPA’s Hard Sell
| Post date: Thu, Aug 16, 2018 |
| Category: International Trade |
| By: Edwin Njoroge, |
Introduction
Economic Partnership Agreements, otherwise known as EPAs, has been a thorn in the East African Community’s foot since its inception on 23rd June 2000. This is because of the conflicting stance taken by individual leaders of the East African countries, as to the benefits or losses their respective countries stand to accrue from the agreement.
Not only have we heard from the leaders of the East African Community, voices have been added from various stakeholders such as Legislators and Policy Makers, Civil Society Organization, the Private Sector and the Donor Community on the consequences of signing or abstaining from the agreement.
So far, Kenya and Rwanda were the only countries to have signed the agreement as of September 1, 2016. Tanzania, rejected the deal while Uganda stated that it would only sign the deal after fully studying it. Burundi, committed to signing the deal.
Kenya has attempted to address the issue diplomatically by engaging its fellow East African counterparts in what seems to be a futile attempt to convince them to sign the agreement. Pundits argue that refusal to sign has major ramifications on Kenya’s economy, more specifically the agricultural sector.
In this article, we shall give a background of the EPAs trade agreement, explain its relations to East Africa, show its current status with regards to East Africa, consequence to Kenya on the failure of the East African Community to ratify the agreement participate and propose a viable way forward for Kenya.
Background to the Economic Partnership Agreements
International trade is important as it avails goods and services otherwise not produced locally. It is also an important means of fighting poverty. This is because producers of goods and services, through availing their products to the global market, are able to receive payments for their produce, which gives them a source of income. It is also credited for availing options to consumers in a market. That is, an individual has an array of products he/she can choose from between the Chinese products or European products within the same market.
Economic Partnership Agreements are a scheme to create a free trade area between the European Union and the African, Caribbean and Pacific Group of States. The main objective of EPA is to support and facilitate trade between the two blocks and to eradicate poverty.
African, Caribbean and the Pacific Group of States were largely former colonies of European Countries. This means that they provided cheap labor and raw material for the industrialization of Europe. Upon independence, the dependency of Europe on these countries for raw materials did not end. However, the former colonies noted that the relationship was one sided. With the advent of independence, the former colonies were emboldened enough to demand greater control of their economies which resulted to the signing of the Lome Agreement.
Lome Agreement
The European Union (EU) offered to reorganize trade to help its former colonies by formulating a trade partnership through which the relationship between Europe and the newly independe
Under this agreement, goods and services from the ACP countries—mainly agricultural goods and minerals which were exempted from tariffs and duties—enjoyed special access to the EU markets. However, the free access did not apply to products competing with EU agricultural products. For such products, access was based on a quota system, where products entering the EU market would be limited, mostly by quantity. On the other hand, goods from the EU were not granted such access in the ACP countries’ markets.
Even with all these provisions, the ACP countries did not fully benefit from the agreement as some of the provisions of the Lome Agreements were disadvantageous to them. An example was the “Rules of Origin”. The Lome Agreements lasted for 25 years and expired on February 29, 2000.
One of the greatest cause for its collapse was because some countries were not happy that the EU was allowing free access to ACP products as this amounted to favoritism. They, thus, challenged this arrangement and it was found that this preferential treatment which was a system of waivers amounted to derogations from the World Trade Organization rules. This called for a re-arrangement which led to the The Cotonou Partnership Agreement.
The Cotonou Agreement
The Cotonou Agreement, otherwise known as the EU-ACP Partnership Agreement, is a treaty between the European Union and the ACP countries. It was signed in June 2000 in Cotonou, Benin, by 78 ACP countries.
The defining features of this agreement were, among others:
i. Reciprocity: meaning that market access would be provided by both parties. In this case, the ACP countries would have to open up their markets to EU exports;
ii. Differentiation: introduced in recognition of the varying needs and levels of economic development of the different states. Each ACP country was allowed to offer market access when they were ready;
iii. Regionalism: the agreement would be between the European Union and a defined group of countries such as the East African Community (EAC), ECOWAS or SADC, among others; and
iv. Conformity to the World Trade Organization System (WTO is the successor of the aforementioned GATT system. It is a multilateral agreement between nearly all countries of the world on trade issues)
In general, it covered the following issues trade in goods, agriculture, fisheries, economic and development cooperation, institutional arrangements and dispute settlement mechanism.
East Africa Community European Union EPAs Context
Member states of the east African community have never found a common ground as to whether they should ratify the agreement. To date, Kenya is the only country in the region that has deposited instruments of ratification. According to the Kenyan Government communique, the ratification is expected to enable Kenya enjoy access to the European Union market.
However, based on the principle of regionalism which is explained above, Kenya may not really gain from the ratification as it needs to join the agreement as part of a trading bloc. The rest of the member states have in the past requested for time to study the agreement in order to reach a conclusive agreement. Such sentiments were well captured in the Joint Communiqué: 19th Ordinary Summit of Heads of State of The East African Community.
Reasons have been given by members of the abstaining from ratifying the agreement include:
a) Market Access
By 2033, the East African Community is expected to liberalize up to 82.6% of all its imports from the European Union. In as much as this has been agreed, members of the East African Community feel that the level of liberalization is too high. It raises the likelihood of having negative implications on livelihoods, employment, shrinking of the policy space, and on efforts to industrialize and integrate meaningfully into the global economy. This extensive liberalization is based on the argument that the region needs cheap intermediate goods to be used as inputs in the production processes thus enhancing competitiveness; and finished products whose availability at lower costs is deemed to have consumer welfare-enhancing effects.
b) Agricultural Subsidies
The EU runs a subsidy program for its agricultural industry called the Common Agricultural Policy (CAP). Launched in 1962, the subsidies program makes it easy for European farmers more competitive as compared to other farmers. Such subsidies are a violation of the WTO treaty. Their effects would be to place such a relatively strong and competitive industry against a weak, yet very sensitive East African industry. This is expected to hurt the respective East African economies.
c) Duties and Taxes on Exports
Under this clause, the European Union would disallow the EAC partner states to impose new export taxes or increase existing ones unless they can justify special needs with regard to revenue, food security, or environmental protection. Export taxes are an essential development tool that can be used in promoting industrialization and employment creation, and in creating incentives to add value to local products rather than exporting them in their raw form.
d) Rules of Origin on Agricultural Products
Rules of origin are the criteria needed to determine the national source of a product. Their importance is derived from the fact that duties and restrictions in several cases depend upon the source of imports. The EU would like EAC to extend flexible rules of origin on agricultural products, despite the fact that these products are classified by the EAC as sensitive products to the EAC Partner States.
The EAC maintained a common position that the outstanding specific rules of origin should be considered as part of the sensitive agricultural and agro processing products and stringent rules should be applicable as a reflection of the spirit of the sensitivity of these products to EAC Partner States.
e) Most Favored Nations (MFN)
Under the World Trade Organization agreements, countries cannot normally discriminate between their trading partners. If a country chooses to grant another a special favor (such as lower customs duty rate), it has to do the same for all other WTO members.
Under this provision, the EAC is obliged to extend to the EU any more favorable treatment resulting from a preferential trade agreement with a major trading economy/country.
The East African Community states that this principle in the agreement will undermine the prospects of South-South trade which the EAC is aspiring to promote. In addition, the clause is contrary to the spirit of the World Trade Organization (WTO) Enabling clause that promotes special and differential treatment for developing countries and South-South cooperation.
Anticipated Impact of EPAs on Kenya
It is feared that liberalization and the provisions on duties and taxes will hurt the most important sector of Kenya’s economy. This is the agricultural sector. According to the Food and Agriculture Organization of the United Nation, this sector is key to Kenya’s economy, contributing 26 per cent of the Gross Domestic Product (GDP) and another 27 per cent of GDP indirectly through linkages with other sectors. The sector employs more than 40 per cent of the total population and more than 70 per cent of Kenya’s rural people. Agriculture in Kenya is large and complex, with a multitude of public, parastatal, non-governmental and private sectors.
The sector accounts for 65 per cent of the export earnings, and provides the livelihood (employment, income and food security needs) for more than 80 per cent of the Kenyan population and contributes to improving nutrition through production of safe, diverse and nutrient dense foods. The sector is also the min driver of the non-agricultural economy including manufacturing, providing inputs and markets for non-agricultural operations such as building/construction, transportation, tourism, education and other social services.
Liberalizing agriculture in Kenya placing it in competition with the subsidized products from the EU could hurt the economy and exposed the very vulnerable in the society. The very vulnerable in the society are farmers.
Not only will the policy of liberalization affect the agricultural industry through direct competition, it is anticipated to lead to dumping of agricultural products which will have a far-reaching implication on Kenya’s agricultural production and agro-processing sector. Many of this negative effects are anticipate to manifest in the future.
In spite of the above negative implications, in the short term, Kenya may reap several benefits of an EPA. The most fundamental one is that there will be no quotas or duties on exports into the EU, thus allowing local producers access to a significantly wider market. The EPA will also enhance and boost trade between Kenya and other regions in the world. Two of the sectors that stand to gain the most is the textile industry and the horticultural industry.
Failure to ratify the agreement makes Kenya loose the EU preference. This will mean that Kenya will be treated as a developing nation, which it is, unlike the rest of the East African nation and thus attract a 10 percent tariff on all its goods entering Europe. As a consequence, this would mean that the majority of products that are currently produced will be put at risk due to tariff elimination in the EPA, and the EU being more competitive, producers will lose market share to EU imports as well in home markets and other EAC markets.
Conclusion: To Ratify or Not To Ratify
It is important to note that trade liberalization is generally good and it has led to further growth of trade internationally. Advocates for trade liberalization point to a growth in global economy which is argued to have raised the standard of living. However, in reality, competition is usually good when rules laid down create and maintain a level playing field.
The primary benefit of the EPA is that the horticultural industry will continue to enjoy preferential access to the EU. Another benefit is that the EAC members will receive aid from the EU to improve their trade infrastructure, which will address some supply side constraints and enable compliance with standards and technical regulations in export markets.
On the other side, the United Nations Economic Commission for Africa (UNECA) states that if the EPA is signed, local industries will struggle to withstand competitive pressures from EU firms, while the region will be stuck in its position as a low value-added commodity exporter . It is also argued that the liberalization measures proposed under EPA will result to lower tariffs which will translate to lower revenue for the government.
The rules as set in the agreement are not alive to the inequalities by the economies of the East African States as compared to the European as manifested especially in the agricultural and manufacturing sector. In light of recommendation from leading organization and the analysis above, a refusal to ratify the agreement and returning to the table for a renegotiation is important, in order to address the above short comings that could, in the long term, cripple Kenya’s agricultural sector.
Recommendations
The Kenyan government needs to tarry in its quest to engage in a diplomatic charm offensive aimed at securing the ratification of the other East African states and further engage stakeholders in order to properly grasp the consequences of ratification of the agreement on the economy. This is in light of the asymmetries that exists economically that tilt economic power to Europe.
Prior to engaging stakeholders, it is important that the leaders of the East African Community meet and structure a frameworks for consultations with various players within the industry which includes farmers, communities and the larger private sector. After establishing the framework, and engaging stakeholders, then can the members of the East African Community meet to discuss areas they enjoy a comparative advantage and reasons some countries and experts are reluctant to ratify the agreement. This will give countries such as Kenya an in-depth knowledge and appreciation of the reason its counterpart’s refusal to ratify the agreement.
The leaders can take advantage of the principle of regionalism by returning to the negotiating table as a bloc, armed with the knowledge of the areas they enjoy a comparative advantage and leverage on it. During the renegotiation, they can also confront their counterparts on issues posed in the agreement that expose the vulnerabilities in their economies.
In case of a failure during negotiations as a regional bloc, Kenya could seek to engage the EU independently without its EAC counterparts in order to secure its economic interests, especially those of the flower sector.
More Blogs
Kenya’s National Budget: A Matatu Ride Reflecting Fiscal Volatility and Structural Inefficiencies
Introduction The matatu metaphor can be used to analytically frame Kenya’s budget as a system that is subject to binding constraints, evolving expectations, and continuous adjustment to shocks. Like the matatu sector, fiscal policy reflects a balancing act between efficiency and quick action seeking to respond to public service delivery while constrained by competing sector […]
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Introduction Imagine paying the same fare to travel at 6 a.m. as you would at 6 p.m., even though the matatu is half-empty in the morning and packed in the evening. At 6 a.m., there may be more seats available than passengers willing to pay for them. By 6 p.m., the situation is reversed. Hundreds […]
What Would It Mean for a Hypothetical Listing of Space X On Nairobi Stock Exchange?
Absurd hypotheticals are useful precisely because they stress-test a system until its constraints become visible. This note asks what would break first if SpaceX, now a public company following its record-breaking Nasdaq debut in June 2026, with a post-IPO market value of approximately US$ 2.5 trillion, sought a secondary cross-listing on the Nairobi Securities Exchange. […]
The Arithmetic of Ambition: What Kenya’s First-World Dream Really Requires?
Kenya’s proposed post-2030 Vision commits the country to high-income status “within a generation.” One positive issue that should be emulated is that the document seeks to solve the most important policy decision and the foundational problem in economics, which is to expand output and labour. Skeptics ask the most important question, why would this plan […]
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According to the Annual Debt Report 2024/25, as shown in Chart 1 below, Kenya today is such that for every one hundred shillings the Kenyan government raises in tax revenue, approximately ksh71 goes directly into servicing existing debt before a single hospital is staffed, a classroom is built, or a kilometre of road is constructed. […]