As much as we are encouraged to embrace free-markets economies,there is great need as Kenyans to start looking at ways and means we can also have a big bargain or say on how capital movements is managed both locally and globally so that we avoid large volumes of hot money in our country

I hear Eastleigh nowadays is a new kid on the block, property prices are heading north (Increasing) at very alarming speed ,

Banks are falling at each other to open branches in eastleigh to tap into these great potential which makes good business sense.

But my question -My Question how long will this economy sustain itself

Question How does capital flight affect the average Kenyan

Answers:

First, money outside Kenya cannot be used to develop Kenya

Second, money outside Kenya cannot be taxed.

Third, it is the poor people in Kenya that indirectly pay for the external debts.

Capital flight increases the level of corruption. The flight of capital means that police officers cannot be adequately paid and are forced to extract bribes that is why Police Officer are justified to mount road block to collect money instead of inspecting vehicles

Medical doctors are happy to give you substandard drugs,

Teachers are justified to offer Remedial classes and

Government employees are justified to ask for tea -extort bribes from you and me.

Capital flight is related to lack of technological development. Because it lacks the technological knowledge, Kenya exports natural resources like sugar from Mumias to EU markets only to re-import refined sugar or white sugar for making Sweets, cooking fats addictives etc

Also we export coffee berries only to re-import finished coffee called . Nescafe at extremely high Price

We export minerals only to re-import cars top Range Land Rovers,Mercendes Benz, Prado instead of bicycles and Tuk Tuk.

Kenya also is busy at exporting one-third of its university-trained graduates read Nurses Engineers like Dr Shem O who went to Kigali-Rwanda to develop IT sector only to re-import technological products created by them or their brains.

Kenya is a consumer of technology (and not a producer). Example major construction projects are given to foreign companies like Strabag-Germany,Chug Chag from China read Mombasa Rd- Northern By-Pass.ABB Norway to develop power lines

Which means a great percent of our revenue collected by our hardworking team at Kenya Revenue Authority flies out to profit Western Countries?

Also profits made by foreign companies eg Unilver and Grand Regency are repatriated abroad and this is pure capital flight which, in turn, increases the level of poverty in Kenya.

A Remedies

It can only be stemmed when Kenya invest in technological development. Kenya, is among, the world largest producer of coffee,tea,sugar but, does not fully possess the technology to refine them.

You will find Kenya imports refined sugar, buys Nescafe from countries it exports to and these results in capital flight. Because of the low level of technological development, the Kenya economy is, by default, based largely on the export of raw materials, the import of refined (technological) materials, and the payment of profits to overseas shareholders.

Attempting to solve this problem without understanding the relationship between technology and capital flight will be like a wild goose chase for a mirage in the desert.

Kenya becomes poorer when it exports raw materials and brains and re-imports finished products.

An increase in capital flight leads to an increase in the level of poverty which leads to an increase in religious and ethnic violence. In Kenya, for example, we have tribes fighting for a greater share of the diminishing national wealth.

A vicious circle is created when the unemployment, social unrest and political instability creates a market for the importation of arms which are often bought on credit and/or by exporting the remaining capital to arms-exporting nations.

This can be justified when MV Faina brought in tanks, weapons that were openly travelled from Mombasa Port to Nairobi by Rail under full glare of cameras

I hope Uganda President need to know we are fully armed and He need to act fast and apologies for taking Migingo Island or we shall Michinja him with those tanks unless we bought decoys instead of real arms

Thanks

Gibson Amenya

Global Young Greens

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Date: Tue, 21 Apr 2009 01:43:39 -0700 [03:43:39 AM CDT]
From: amenya gibson
Subject: Uncontrolled capital flights will make Kenyans remain beggars forever