Abacus Wealth Management

Change – A Running Commentary

“…men do change, and change comes like a wind that ruffles the curtains at dawn, and it comes like the stealthy perfume of windflowers hidden in the grass…” – John Steinbeck, Sweet Thursday

 

In the last five years, the Kenyan society has been transformed by what can be termed as the nascent stages of a societal renaissance; with this change riding on the back of the so-called Generation Y.

Long thought to be a destructive force, unstable and unproductive; the youthful energy they have has caused quite a number of changes in how our society functions. This has been fostered by an increase in the number of people living in urban areas; Kenya being one of the many African countries whose population demographic is an inverted pyramid.

Along major traffic corridors, traffic jams have reduced dramatically – though there is still much to be done to open up areas in the periphery of Nairobi and Mombasa. For instance, what the Thika Super Highway (and it’s adjacent by-passes) has done is ease rental prices in traditional urban dwellings owing to the now relative ease of living outside the city – and as a direct consequence, the provision of public utilities such as electricity and water has been made easier in residential areas along major highways. Going forward, investments in real estate geared towards low-income earners will yield rewards seeing that it remains an untapped market.

Kenya has a youthful working population. You only need to take a stroll down Moi Avenue or Tom Mboya Street to realize that all the shop attendants are well below the age of 30 – running Mpesa stalls, mobile phone shops and movie rentals. This is a direct result of Kenya’s average, but steady growth in the last ten years, allowing more people to access business finance and spurring entrepreneurship.  These new enterprises have been buoyed by a greater spending power in the middle class, though that has slowed down (globally) in the more recent past owing to the domino effect the Euro-done debt crisis has had on African economies.

With increased spending power comes with increased recreational time and discretionary spending on leisure and associated goods and services – such as alcohol, restaurant and game park services. Indeed, the recent past has seen weekends packed with what some choose to call “top-tier” social events such as Blankets & Wine, The Art & Beer Festival, The Bamburi Super Series, Soko Soko Craft Market among many other events. This points to a shift in consumer spending habits and tastes.

In addition, our country is undergoing renewed cultural self-confidence. Just four years ago, there was an explosion of poetry and “spoken word” events in most major cities – carving a new niche in the world of art. Online, Kenyans are known to be viral bloggers with every nation incident evoking a tirade of commentary from Kenya’s citizen journalists. This cultural awareness and sense of identity has also led to the founding of numerous clothing lines that promise “truly African designs”. Urban Phunk, Fundi Frank, Kikoromeo, Nancie Mwangi, Kaán, Chilimango Clothing are just but a few of the names stirring the fashion waters, in an industry that has been submerged and heavily reliant on imports from the South East Asia.

It is redundant to speak of the way mobile money has revolutionized the exchange of funds – enabling one to pay for virtually anything ranging from one’s Dstv monthly subscription, life insurance policy premiums and electricity bills – making “sms money” ubiquitous and more importantly convenient. Mobile money has brought financial inclusion to the erstwhile unbanked majority; mobile money has made inroads into most, if not all, of society’s economic engagements – allowing a father to pay maternity bills with ease, a mother to pay school fees while away and mobile money interoperability with bank accounts allowing for more efficient mortgage payments.

Finally, we have been experiencing a heightened sense of political assertiveness from the youth, in ways not seen before. With the Constitution allowing citizens to challenge appointments in court and even on the streets through non-violent civil disobedience, public participation has rapidly grown into an indispensable part of official appointments. Eventually, this will yield a more accountable and responsive government that is in tune with citizens’ aspirations.

The Bean counter thinks: I am convinced that with an improved economy and political system, Kenya is well on its way to becoming a middle income economy by 2030. In doing so, we must be careful to ensure that the improved economy yields results for all of us, and not merely those in the middle and upper class. For this to happen, government must be both deliberate and measured in its policy implementation to allow for greater employment, sustainable development and prosperity for the vast majority if not all.

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