Leaked: Report alleges Kenya's Former President looted billions

Republished from Kenya Imagine
Friday 31st August 2007

Former Kenyan President Daniel Arap Moi declared that he would back incumbent Kenyan President Mwai Kibaki for a second term in the upcoming Kenyan General Elections later in the year. The news of the union of souls has been met with responses coming in at acres of newsprint and millions of gigabytes dedicated to suggesting various motives and calculations that would bring the two erstwhile foes together. It is with interest therefore that we read in today's Guardian of the findings of a leaked report commissioned by the government of Kenya into corruption and the Moi family.

The article published here in today's Guardian under the title The Looting of Kenya - The breathtaking extent of corruption perpetrated by the family of the former Kenyan leader Daniel Arap Moi was exposed last night in a secret report that laid bare a web of shell companies, secret trusts and frontmen that his entourage used to funnel hundreds of millions of pounds into nearly 30 countries including Britain.
The 110-page report by the international risk consultancy Kroll, seen by the Guardian, alleges that relatives and associates of Mr Moi siphoned off more than £1bn of government money. If true, it would put the Mois on a par with Africa's other great kleptocrats, Mobutu Sese Seko of Zaire (now Democratic Republic of Congo) and Nigeria's Sani Abacha.


The assets accumulated included multimillion pound properties in London, New York and South Africa, as well as a 10,000-hectare ranch in Australia and bank accounts containing hundreds of millions of pounds."

It is now clear that the report, submitted to the government in 2004 has been kept under wraps against the spirit of the passionate declarations of 2002.

The Guardian's Nairobi correspondent Xan Rice claims to have seen a leaked copy of this report which makes serious allegations of corruption by relatives and associates of the former president.

According to the article some of the claims made out in the report include:

* More than £1billion pounds was moved out of Kenya

* The former President's sons - Philip and Gideon - are reported to be worth £384m and £550m respectively;

* His associates were said to have acted in collusion with Italian drug barons and been involved in printing counterfeit money;

While it is true that the report which was prepared by Kroll Associates is not a decision of a court, and therefore binding, it is odd that the government, elected on an anti-corruption platform and pledging to make a clean break with the past has not previously published the report. Alfred Mutua, the Government spokesman, in response to the charge, declares that the government found the report incomplete and therefore could not release it to the public.

But now the questions, and there are many. How much did the government pay for this ‘incomplete and inaccurate' report? Are the report and the shadow it casts over the former President the motivation for this week's power pact? Is this the proverbial pound of flesh? Does the burial of the report mean that the sins of the Moi era are dead and buried? Forever?

The report was exposed due to the efforts of Wikileak , a safe haven for whistleblowers and other persons of conscience working to end corruption.

Tanzania will not be bulldozzed by pundits into quiting SADC for COMESA

I recieved some serious bashing from N.Chiume, currently based New York because of my previous post(Tanzania diminishes chances of regional intergration), that he called a smokescreen that lays blame on the shoulders of Tanzania when it comes to EAC intergration. He raised some very pertinent issues that will deepen anyone's understanding about Tanzania and it's association with South Africa and SADC. Chiume is of the opinion that Kenya(ns) are out to deliberately soil Tanzania's name by publishing malicious articles through the media. He pointed out one case about KBC (Kenya Broadcasting Corporation) which he calls "Gorvernment owned media" that claimed Tanzanians had overwhelimingly rejected the proposed East African Federation. Below is what Chiume had to say in verbatim.

"I'm glad to be here. First, let me apologise for any distress that I may have caused you by certain choices of my words. It just shows the level of frustration people like myself feel whenever we read an article that carelessly misrepresents the facts with a pretext of "open[ing] up the issue for debate". It just makes it hard to have a constructive debate, that indeed we should all have, if we don't address the untruths from the offset.

Case in point, there was an article last week in Kenya Broadcasting Corp (KBC) website(which if I'm not mistaken, is still a Government owned media institution), twisting the results of the poll in Tanzania asking wether we should fast-track EAC or not. KBC reported that the overwhealing results against such a move meant "Tanzanians say no to EA federation". It went further claiming that Tanzanians "have rejected the plan for the East African political federation" while we all know that the referendum on this subject is still in the offing. Perhaps you can help me understand the motives a Government institution like KBC have in publishing such a misleading article?

Fact is, Tanzania has shown tremendous commitment to EAC, from hosting the HQ in Arusha, to building institutions like EAC Judiciary and Legislature, to negotiating and implementing the Custom Union despite the fact that its also a SADC member. Your claim that Tanzania's membership in SADC makes her "stand on EAC issues..always opposite the rest of the [EAC] members" are therefore absolutely baseless.

Asking Tanzania not to have "strong ties" with southern Africa is similar to asking Europe not to have strong ties with America! Tanzania is a founding member of SADC, and of SADCC, its predecessor. Our history, our engagement and our attachment to southern Africa since the days of Frontline States and prior to that cannot be lightly severed.

Therefore, there is nothing sinister that "raises questions" about Tanzania's friendship with South Africa - anybody who knows her history will appreciate it. If you can make an argument like that, then I could equally claim that Kenya's one foot in COMESA and another in EAC "raises questions" in the eyes of non-EAC members of COMESA, such as Zambia, Sudan or Eqypt because it shows Kenya's not commitment to COMESA! In that case, Kenya could equally be described as "an undecided country" that "is unstable in all its ways".

What is universally recognized is that as SADC moves towards becoming a trade bloc with custom union, then a common market etc (as opposed to a grouping for coordinating common economic projects); and as COMESA moves from a free-trade area to custom Union etc, countries like Tanzania - and so many others including Kenya and Uganda, will have to make the tough decision on how they can continue membership in increasingly conflicting organizations.

I'm saying this because one of the biggest misconception that individulss like yourself perpetuate is that somehow it will be hunky dory if and when all EAC members belonged in COMESA! It is as if no conflict will emerge out of EAC custom union with those of a future COMESA custom union.

Competition from Kenya isn't "mere BIG words". It does pose serious threat to the future of manufacturing in TZ. And its not true that these concerns have never been brought to the table by TZ. Case in point, the successful agreement in delaying implementing certain taxes within the EAC custom union to give manufactures in TZ some time to adjust to the new trade environment.

As we progress into common market, single currency and a political federation, these concerns are clearly being accelerated and reflected in the results of the fast-tracking poll in Tanzania. There is too much of selling of the positives of intergration and little in terms of addressing the adverse effects of it. For instance, Tanzania could well be forced with the reality of ceading the dominance of manufacturing to Kenya but that will only be okay of she is able to identify and begin to focus right now in alternative sectors that will bring them competitive advantage in the future, for example, in service economy. Hence, we will require economic programs to subsdize the manufacturing that will decline and to build up the service economy. The people in TZ are pressuring their Govt for answers to such issues, and are observing the gradual benefits that come with intergration before they can make a judgment that full EAC intergration will truly be benefitial to their daily livelihoods, not simply empty promises. The aim is not to ignore globalization but to ensure it really works for them.

The issue of belonging to multiple regional groupings is not uniquely Tanzanian. How come you never raised the conundrum that Kenya will face with the anticipated COMESA Custom Union while its already a member of EAC Custom Union?

Its quite absurd to imply Tanzania doesn't belong in Southern Africa (hence not a natural member of SADC) while at the same time urging it to join COMESA, a grouping with southern African countries further south of Tanzania like Malawi, Zambia and Zimbabwe! The next thing you will claim will probably be that Swaziland belongs in COMESA more than it does in SADC!

Tanzania happens to have strong links with southern Africa, as much as it has with Eastern Africa. To ask her to abandon its long standing relationships in favor of EAC only is just idiotic to say the least. We want to do business with as much neighbours as possible and South Africa has been a positive economic force in Tanzania, challenging the dominance of Kenya in the country. It appears that these constant concerns about Tanzania belonging in SADC are a manifestation of Kenya's nervousness towards South Africa coming to compete in its backyard through Tanzania.

Tanzanians will not be bulldozzed by pundits like yourself. The people of Tanzania have a right to know precisely how they will benefit from EAC Federation and its economic integration. The issues of job loss, land grabbing, political stability etc are very relevant to them. They have refused fast-tracking the Federation because the idea is unrealistic (in terms of implementing it within 5 years) but not because they are not in favor of the Federation. Most Tanzanians see it as something achiaveble by year 2020.

The debate we need is not why Tanzanians are ambivalent about EAC, but what can be done to address their concerns. Economic and targeted programs should be suggested to help countries like Tanzania whose economy will be negatively impacted, at least in the short-term. Such things will help to calm the jitters towards a noble idea of economic and political integration."

Tanzania diminishes chances of regional integration

On 20/08/2007, after the 6th ordinary session of the EAC Heads of State, I waited with bated breath for the announcement of a fully integrated East African Economic Union, a union redeemed from the fear and suspicion that previosuly led to breakup.
To my dismay, the same structural failings and issues that necessitated the first collapse still exist. During the first collapse it was easy to blame ideological differences between Tanzania and the rest of the East African Community since the latter was socialist while the former shared capitalistic ideologies. This aside, the real reasons as time came to reveal was the fear that Kenya dominated the rest of the community.

Following the collapse of the EAC and prior to the recent haphazard re-integration, arose the Common Markets for East and Southern Africa (COMESA ) the only remaining workable regional organisation that Kenya, Uganda and Tanzania had in common. This was until Tanzania opted out again to join South African Development Cooperation (SADC) , allying itself to what is clearly a grouping for Southern African countries.

This move, perhaps inoccuous has had varied ramifications. Within the past three years projects that would span the whole of East Africa have been marred with confusion due to differences between the states. For example Kenya had to opt out of Eassy project (East Africa Sub Marine System) a cables project that would have considerably lowered the cost of fibre communication in the region. Word was that South Africa was employing underhand tactics as far as ownership of the cables project was concerned, which developments caused Kenya to initiate a parallel project; TEAMS (The East Africa Marine System) to replace Eassy. As a member of SADC, Tanzania occupies an unenviable position in this regard, especially as although she is seen as siding with South Africa in SADC, she has not the clout that would make a difference in the southern group at all.

The meeting lasted several hours, and after what must have been intense haggling, the leaders emerged to announce failure to secure a smooth predictable transition to regional integration. However, of all the countries; Kenya, Uganda, Tanzania, Rwanda and Burundi, it is Tanzania that had the greatest objections to the speedy integration of the region. One major extenuation given was that Kenya would dominate the resultant economy. As a face-saving gesture, Tanzania agreed ,though apprehensively, to a Common Market, Union and currency by the year 2012. During this meeting, the rest of the East African states were categorical that they wanted a more expeditious integration of the different economies while Tanzania opted for a step-wise approach. This is understandable and has indeed been a constant refrain of many East Africans. Still many wonder, given her doubts ,is it Tanzania or is the thought of a formidable East African Region unworkable?

When Tanzania first ditched COMESA for SADC it gave what were seen as valid reasons as to why it made the move. Fast tracking to the present time and the very same country still has issues with the East African Community with the majority of its concerns relating to economic and political competition(again).

Granted, Kenya still dominates the region's economy and has been able to maintain this even in the absence of East African Federation. But it is not true to say that Kenya would benefit the most from the union. The uniform trade platform that would have been created to replace the current regime, would have boosted trade and promoted business and new jobs across the region.

Like in any union, there are teething problems and the peculiar concerns of individual members to address. Still, if as is becoming clear 4 out of 5 would be members of an East Africa federation are willing to go ahead with an economic union, why be precluded by Tanzania whose priorities are clearly obscured?

A new way for small businesses to build their online profiles

I consider blogging as one of my top ten strategies that can assist small businesses to grow without necessarily incurring huge marketing and advertising costs. The fact that most blogging platforms offer free services for as long as you adhere to the rules and regulations should be embraced to assist small businesses especially in Africa where the cost of such services are higher than what most small to medium sized enterprises (SMEs) can afford.

For instance compared to conventional websites, blogging would cost you almost nothing except the time you take to publish. When we equate time to money, building a business blog would cost you roughly half or less the amount it would take to build an online product portfolio.

Businesses that can successfully embrace the power of blogging include the Jua kali (informal small scale merchants) that are based in Kenya who create a wide portfolio of products using recycled materials and yet outdo the big players. In a typical day, a Jua kali factory is capable of creating products worth millions of dollars. Unfortunately not all products are able to sell because of what I consider artificial market restrictions. Smart as they are, Jua kali vendors are not able to make significant sales as they lack proper marketing mechanisms.

In one business support session I met Mr.Mbai a Kenyan Jua kali entrepreneur who has never stepped into any school of carpentry but can work wood better than wood peckers.. In a month, Mr. Mbai’s workshop churns out products that he sometimes cannot sale. Most of the time his products fetch a break-even price therefore leaving no room for growth. Asked why, he explained that his business depended mostly on sales made by self-appointed agents who he reckons gave raw deals. Goodwill and customer referral also played a key role in determining his sales.

With advice from BT International a corporate branding company that is working with SMEs to improve their market penetration using affordable branding strategies, Mr. Mbai was able to single out lack of product information by potential clients as an important factor that lead to low sales. He also learnt that he could not make just any products hoping and wishing that they would sell. To be able to respond profitably to the specific needs, he needed solid facts about his target market.
Immediately after learning about this conventional business issues, Mr. Mbai was quick to point out that his business was not as big and therefore could not raise enough capital to meet the requirements that had been advised. This was not an issue as far as BT International was concerned. Firstly the easiest and most affordable way to let the world know about his products was to build a customised website that detailed his product with all the prices and how to access them. It is easier said than done because Mr. Mbai neither has the knowledge nor the time to work out a customised website. To make the matter worse, he cannot afford to procure such services, as they would significantly raise his operating costs.

For Mr. Mbai, what was wishful thinking is already bearing fruit and costs him as little as 10 US Dollars a month to access professionally managed online portfolio. He started small, but now his business blog is on its second phase before finally turning into a customised corporate website. The phased approach was used to make the service more as affordable to this kind of business. All sorts of comments that were posted on Mr. Mbai’s professional online product portfolio helped him re-engineer his business complete with a brand name and specific sub brand names for the different products that he churns out every month. Now the sky is the limit.