Lebanon: Reform, Recovery, and Reconstruction Framework (3RF) – Co-chair Statement by the Prime Minister of Lebanon, the UN Resident Coordinator, and Representatives of Donors and Lebanese Civil Society (12.04.2023)
I write what I like.
“Transport CS Kipchumba Murkomen releases SGR agreement for public scrutiny. Some key loan terms:
~ Loan amount not exceeding $1.6Bn
~ 2.0% per annum interest
~ 0.25% management fee
~ 20-year tenure with a 7yr grace period
~ preference for the purchase of goods from China” (Kenyan Wallstreet, 06.11.2022).
The SGR Agreement decides that the Kenyan Government has 13 years to repay the loans for the Standard Gauge Railway (SGR). This is happening after the 7 year grace period. The agreement was signed off on the 14th May 2014 and 7 years after that is last year May 2021.
There been speculations about this agreement ever since the Jubilee government signed it and accepted it’s terms. It was even at one point, rumours that the Kenyan government had signed off the Mombasa Port operations to the China EXIM Bank.
What it instead says in addition to the terms of the direct financial manner. It says something very interesting…
A key parts of the SGR Agreement is this, as well as the other mentioned terms: “The Borrower undertakes to procure that the Government of Kenya or the relevant authorities of Kenya shall stipulate and issue preferential policies, regulations or approvals in relation to RDF which could be applied in priority to make the repayment of loans in relation to the Project as owning to the Lender, the Long Term Service Agreement and its due performance, the revenues generated from the Project which will be applied in priority to make the repayment of loans in relation to the Project as owing to the Lender (except for the expenditures of operation and management of the Project), the Inlander Container Depot (inland port) established in Nairobi and its mandatory customs clearance, and all other necessary policies or approvals, with an aim to ensuring the due operation of the Project and the repayment of such loans in relation to the Project as owing to the Leader” (SGR Agreement, 2014).
Here the borrower is setting the terms of usage and how the transport policies are set. This is now in print and in public. It now makes perfect sense why the authorities and the government ordered all goods or movement of cargo is directed to the SGR. That is done in accordance with the agreement actually. Because the stipulation is actually there…
Certainly, you can wonder if Beijing or the China Exim Bank is happy with the leakage of the agreement between them and the Kenyan Government. They would most likely be happy to have it under seal and hidden from the public space. Because, now the realities of this agreement is in the public domain.
The SGR is already a sort of failure and lack of creating revenue. That’s why the SGR haven’t been profitable or had the ability be viable. That’s why the Kenyan Government had to direct all cargo to go through the SGR and to the Navisha or Inland Port in Nairobi. Therefore, this agreement is just showing how bad this deal was.
The one winning here is China and they are getting lots of interests out of it. They are able to get the Kenyan government on their side. The Kenyan Government accepted a huge loan for an expensive railway. A railway that will take forever to be a feasible enterprise. That’s why these terms will be a liability and an expensive expense for the taxpayers in the years to come. While the SGR will not deliver or be able to re-coup the debt. That’s what is tragic here… Peace.
“Activist Mutemi Kiama at the Milimani Law Court, Nairobi on April 7, 2021. He was arrested over viral graphics he allegedly made warning the world against issuing loans to Kenya” (Nation Africa, 07.04.2021).
I didn’t think Kenyan President Uhuru Kenyatta would sink so low. His now arresting people for the same reasons like the other Presidents in the region have arrested people for mocking them. Museveni has arrested a comedy group for a joke. Nkurunziza arrested someone for painting on his picture. Magufuli arrested a comedian for making a face-off on social media. Now, Kenyatta is following their steps and copying them even.
Activist Kiama made a poster with Kenyatta on it. It got circulated on social media and apparently went viral. This was made as a part of the cancelling loans from the International Monetary Funds (IMF). As the Kenyan Government have already excessive and huge a debt burden, as is…
That is why activists are against taking up more loans … since next generation will have to repay these loans and fork up taxes to pay down on these. These odious loans will haunt the republic and the interests will be a burden on the general public. Because, the current administration is eating heavily and spending more funds than their revenue. This is why the shortcomings of the spending is fixed by loans to cover the deficits created by the same state.
Kenyatta and his allies is maybe favourable of this idea. Since they are eating and enjoyed years of misusing funds. They have paid ghosts and kick-backs to each other. That has been a good business and very profitable. So, when people are mocking that and questioning that. That is clearly an offence and not allowed to do.
Kiama have only done his duty as a citizen. Maybe you don’t like the manner of which he did it. Nevertheless, he used his voice and spread his opinion. The poster is funny and makes you smirk. You know the authorities and the state is lacking compassion and heart. When someone is arrested for making this. If someone gets arrested for this, what is the next criminal offence?
Is the President a Demigod who you cannot mock now? Is Kenyatta the sole proprietor of the state and no one should make jokes about him? Is it illegal to make satire and question his office? Is borrowing money from IMF a holy cow for the elite in the Republic?
This holy cow being the image and mocking the President. That is now a cyber crime and says more about how little the authorities values liberty or freedom of speech. If someone is arrested over as little as this. You know that anyone can become a criminal. Heck, everyone can become serial criminals. If they start to scan through WhatsApp, Twitter, Facebook or anywhere else.
There will be so many who has mocked, lazed jokes and even spread the memo of toying around with the President. That is just natural and a Head of State should have the character to brush it off. If he cannot manage this… how can he manage to rule a nation or even be mentally stable to discuss national importance. When he has to go after activists like this…
Kenyatta is really not that great when this happens to Kiama. However, some of us saw that coming when the likes of “Cyprian is Nyakundi” have gotten his phones, lap-tops and other equipments confiscated by the authorities before. Therefore, Kiama isn’t the only who ended up with this.
Kiama just made a poster and was participating in a social media campaign. That shouldn’t be a crime, but instead be a way to enlighten the public about the problems the loans are causing. This should worry the President and the state should explain why they need more loans to carry its weight. Instead of arresting people for wanting them to not take it.
President Kenyatta has used a bitch move now. It’s insincere and show his insecurity. Now the public cannot humiliate him or play around with him. If they do… they shouldn’t do it on Social Media. If they do.. it can easily become a cyber crime and show what sort of bitch the President is. Who cannot manage some fun criticism. That’s because his not yet told the world that his Clark Kent (Superman) and this is apparently his Kryptonite. Peace.
You want another rap? Nah, didn’t think so. Even if President Museveni wants a BOP. Not a DaBaby track or anything. His just approved the US$500 million dollars to the Republic. This was reported earlier this month and he approved it on the 6th of May 2020, but stamped by the Ministry of Finance, Planning and Economic Development (MoFPED) on the 11th of May 2020.
What is unique here is that this loan is given on the idea of “Balance of Payments”. Economist would know that this to cover the deficit and the balance the budgets. This is to ensure the state has enough revenue to already cover the deficit it has. That is why grants and loans comes to ensure the levels of revenue covers the spending. This means that the state has spend a hundred dollars, but only had 50 dollars in liquidity. So, to ensure the accounts are balanced, the BOP comes in and fix the shortfall.
Museveni writes this in the letter:
“The money that goes to the Bank of Uganda is for “balance of payments support”. “Balance of Payments supports” does not only mean helping the country to “import more” but must also mean helping the country to “import less” by manufacturing these products here. With this undertaking, I approve the loan” (Museveni, 06.05.2020).
Because what the support does in the instance of the hundred dollars budget with a shortfall of 50 dollars revenue. The BOP support is the missing 50 dollars and makes it zero. Meaning, the accounts and financial flows should turn into zero. That means with the budget with its expenditure and its revenue its should be a nil or zero sum game. Therefore, when the President claims this helps local industry and less imports. I don’t see it.
Especially, if this is a BOP. Because, a BOP is a fixated way of balancing the budgets, not secure more trade. Its to cover deficits between expenditure and revenue. This isn’t a magical sphere of happiness and joy. This is budgetary measure to cover the shortfalls and lack of domestic revenue. To cover expenses that appeared or was already budgeted. Therefore, the need of Balance of Payments from the IMF to cover those.
This can be seen as a Financial Inflow to cover the deficit.
-100 dollars budget/Import
+50 dollars revenue/Export
+50 dollars Financial inflow (BOP Support)
That is why, when the man says like this. Its a game of balancing the budget. Not putting a wand on the thing and swiftly changing things. This is just a financial measure to cover a deficit. A short-term solution to a shortfall. That will not solve anything, but by time. Not cover debt, not create a market nor make a big difference. Its just covering expenditure. Nothing else.
The President can make it seem so, but that wouldn’t be a BOP. That would be another instrument and another measure. Where the funds was actually meant for investment. This is covering the basics.
Let me end with DaBaby: “I needed some shit with some bop in it (Let’s go)” (DaBaby – ‘BOP’ of KIRK, 2019). Peace.
The International Monetary Fund (IMF) might have the best intention, but when you give debt relief and certain programs funds to several of republics. Don’t expect this to be spent on the public there. These funds will be squandered on big convoys, don’t expect suddenly these dictators do build fancy hospitals for poverty lingering citizens. Who hasn’t been a priority and only useful, when they need grants and loans from the likes of IMF and the World Bank (WB).
On the 2nd April 2020, the IMF approved US$ 109.4 million to Rwanda. This is supporting the militaristic regime, which have ruled since the genocide in 1994. Therefore, giving a lifeline to President Paul Kagame. Who is gettign rid of his opposition, activists and they suddenly dies. That’s why they are ensuring a small praising elite in Kigali to overpower the public with more funds like this.
On the 3rd April 2020, the IMF approved US$ 97.1 million to Togo. This is supporting the Second Generation Dictator Faure Gnassingbe who is just sworn in for his third term in office. Where all protests are hard hit, where the real opposition is destroyed and there is lack of real investment into the the state. As the Gnassingbe family, who has ruled this nation from 1967. They haven’t showed any interest in real development and only using the state as a private business operation.
On the 9th April 2020, the IMF approved US$ 147 millions to Gabon. Where second generation dictator resides. The son like father, keeps the state all enclosed. Omar Bongo Ondimba follows Ali Bongo Ondimba. These funds are given to a man who is following the family affair of running this state. This is has been done since 1967. So, they are validating the Bongo regime and they will continue to constrain it.
On the 14th April 2020, the IMF approved US$ 115.1 millions to Chad. Another big-man and militarized government run by Idriss Deby Itno have ruled since a coup in 1990. He rules by decree and silence his opposition. So, it not like this man is saint. Your not a saint, when the only way the opposition dares to show their affection is to whistle. Not like the IMF cares about that, because these funds will be given to an boast of his army, whose not only battling Boko Haram, but also constrains the public.
On the 4th May 2020, the IMF approved US$ 226 millions to Cameroon. This is boosting the President for Life, Paul Biya. The Ghost of Cameroon and Swiss Landlord of Cameroon. The man who kills own citizens in the North-West and South-West Regions, the Ambazonia parts of Cameroon. The man who rigs elections, uses army against his own citizens and who has reigned non-stop since the 1980. So, this man hasn’t developed Cameroon, except for making his elite wealthy and making his own family richer than the nation. That is the ones the IMF is bailing out.
On the 6th May 2020, the IMF approved US$ 491.5 million to Uganda. This is giving money to the militarized government of President Yoweri Kaguta Museveni. The government who has run the Republic since the coup in 1986. A man who torture, detain and assaults his opposition. A man who uses the government as private property. A man who is the “high above” and who directs anything from his State House. Who has had debt relief and grants gotten lost, paying ghosts and so fourth. These funds will squandered and only feed the kitchen cabinet, not the public. He has had the time from 1986 to develop the Republic, but have instead built a big army and the biggest entourage on the continent.
So, the IMF is giving these money out in good faith. They are doing it with a purpose, but don’t expect to do any good. These funds will boast and give the Dictators a lifeline. That is sad, its a bitter pill to swallow, but needed to be said. Since, the IMF is by doing this giving way to the most ruthless leaders on the planet. People who have no heart, but only lives for their own personal greed. These people can order the death of their enemies and can without a flick of their eyes make someone stop.
That is why this money will not be used for the purpose of which its given. It might be some of the dollars ending up to nurses and frontline workers. However, this will most likely pay of their pet projects like para-military groups or security organizations, which is used to monitor the public. The money will also go to the expensive lifestyle of the President and his cronies. While only a few rain-drops will go to public. However, don’t expect these funds to go anywhere useful. Than, your lying to yourself and very naive.
You don’t become big-men like these without being using force and not caring about governance. They are there because of the guns, the method of fear and intimidation. These funds are given to men who uses their state as a racket.
The IMF like I said does this in good faith, but its a reason why its faith. Because they have trust and belief it will do some good, but don’t expect magic. There is no magic wand to fix things, especially with the leadership at the helm. What is worrying is how easily they could get these millions of dollars, because of the global pandemic.
They will misuse it and it will be squandered. It just a matter of time, before ghost companies and ghost workers are paid. Before sudden funds have gone missing and no one can find the allocation. That is just what happens. Also, the elite will get a big pay-check, because their loyalty is worth more than gold for these men. Peace.
Back in the day, President Yoweri Kaguta Museveni in the end of the 1990s the World Bank let the Republic of Uganda the opportunity to join their Heavily Indebted Poor Countries (HIPC) to cut the debt of the Republic. However, even with the massive amount of debt relief done in 1998 and later never stopped him from taking up more debt.
That is why the amount of interests paid on every single budget is debt burden, which is created by the President himself and his extensive cronyism. The President has ensured that the state owns so much money, while he stills continues the drill by financing half of it by more debt. Which has been method the National Resistance Movement (NRM) and Mzee has used in the recent years.
That is why such a big amount of funds is going into interest payments. Also, why the Republic are going in a negative spiral, while the lack of domestic revenue isn’t following the projections of growth that the state always promises.
With the knowledge of this, as the President is asking for a debt relief now. His using the Coronavirus or COVID-19. The whole world are into a recession because of this. It is the perfect smokescreen. The President had the 2000s and 2010s to fix issues, but instead the plunge the economy anyway. He just need an excuse for a bailout.
Last time it was Universal Primary Education, a empty campaign promise and now there are plenty of dilapidated schools. They played and tried to focus on it, but gave it up along the way. Because, doing this properly would actually cost time and effort. The President and his big convoy would actually have invested more, than they wanted too. More promising spending on proxy-wars, than on proper education for everyone.
So, knowing that the Multi-National Organizations, Bretton-Woods Organizations and donors gave way to the Uganda in between the late 1990s and early 2000s. They offered billions in various of schemes, not only HPIC and Poverty Eradication Action Plan (PEAP). This has been done already and still the state is bound by loans and grants to function its government. Therefore, the bullet of debt relief has been wasted.
The amount of US Dollars spent on the debt relief earlier in the reign of Museveni. The Head of State has misused this in the past. Not like he will change now. He has used the system to pimp his budgets and his wealth. His enriched himself and his cronies. While the Republic is still poor and the revenue isn’t growing like the economic recovery of the 1990s said it should have done. If the cure of the past would have worked, than the need for debt relief now would be unnecessary.
In 2020, the Republic shouldn’t get debt relief. It will be only spoils for the elites and the cronies around the President. It will be used buying tear-gas and SUVs. The WaBenzi will eat the spoils and only give away beans to the ones in need.
That Museveni says the continent needs debt relief. He means that himself needs it now. Even if his a wealthy guy in an impoverished republic. A republic he has run for three decades. Which already got special treatment and had a controlled Consultative Group. So, its not like this man hasn’t pimped the system already. He has tricked it and promised to juice up vehicle, but instead continue to run it to the ground. Hoping he could trick some new leaders to do the same mistake. Trusting him and his “high above” leadership.
They already spent millions of dollars to cut of the debt of the Republic under his control. The leadership is the same and they will misuse this if they get it again. When he had the opportunity to use it the last time. He instead wasted it and has ensured the state is more addicted to loans. That is why he hopes someone else can bail him out. While his paying ghosts, fake tenders and whatnot.
So, the IMF and World Bank should know this, but they are maybe more afraid of their image, than the result of letting go of some funds. These funds will not help anyone directly out. Only ensure the President longer life in office. This will not help the ones in need. Than he would have already ensured that. Instead his continuing this ballad and serenading the international community. While he hopes that no one knows history.
He has failed the last debt-relief and misused his chance. That is why his continued to grow the debt, addicted to grants and not created a space for more development. Unless, they give the President some handshakes at the State House. This is the way it goes.
The President of the Republic has had all the time since 1986 and we are still here. There are still opposition Members of Parliament who are tortured, there are still lack of free space and militarization of politics. That has never changed, but he hopes nobody notice. That is why he hopes he can pimp the International Community another time. He already did the trick and hope he can get them buzzed by a few buzzwords.
I know for some this is a moment of nostalgia, but for some its deja vu’. We have been here before and we shouldn’t need to repeat the same bad tune, again and again. However, I expect nobody to listen to me. Peace.