Seven Fat Cows, Seven Lean Cows and the Kenyan Maize Conundrum

NCPB silos. Courtesy

By GEORGES JANATA

That economics went green with physics envy before it could blunder into its first blush of youth is one of its worst kept secrets.  Perhaps due to that, it appears to take a turn after the second law of thermodynamics, and assumes that time is an arrow.

Still, it has the native sense to accept that whorls of economic output do unfurl in boom-bust cycles. Every seventh year of the last half a century heading to 2015 has been marked by what David Cameron metaphorically calls “red warning lights…flashing on the dashboard of the global economy.”

Neither does this “seven year itch” turn out to be a recent phenomenon. Long before Probit and Stock-Watson models became a glint in the eye, the dreams dreamt by visionaries in the dark watches of the night provided the main means for reading the tea leaves.

1,850 years before Christ, the Pharaoh dreamt. “…and, behold, he stood by the river. And, behold, there came up out of the river seven well-favoured kine and fat-fleshed…

“And, behold, seven other kine came up after them out of the river, ill-favoured and lean-fleshed…And the ill-favoured and lean-fleshed kine did eat up the seven well favoured and fat kine.”

A complete car crash, thus, followed the blossoming within the Delta Region and Faiyum basin, nudging the agrarian economy of pre-Dynastic Egypt into a seven year itch.  Under the bonnet of that broken-down car, Joseph tinkered. The red warning lights on the dashboard flashed off. Out came a strategic grain reserve policy that smoothed the glut-dearth spiral.

Slightly more than 1,850 years after Christ, the bearers of the Kenyan dream fashioned their response after the pattern of the “Joseph template.” Kenya’s economy pivots around the agricultural sector. Three out of every four Kenyans earn all or part of their income from agriculture. The sector contributes up to 33% of the country’s GDP.

Maize, the staple grain, provides one out of every three calories consumed, and consumes up to one out of every two shillings spent on each household’s food budget. But growth in maize production has been linear, while that of the Kenyan population has been exponential – hence the eruption of a Malthusian crunch, and the transformation of the country into a net importer.

In spite of the billions spent on fertiliser subsidies, Kenyan maize is notoriously expensive and its growers still can’t step up to the plate. In 2017, a 90kg bag sold for $45, compared to the average global price of $14. Does it not then make sense to import the maize from more efficient producers such as South Africa, Malawi and Zambia and devote our Faiyum basin into more productive use? Isn’t it time we did obeisance to the idols of the comparative advantage theory?

But what value is there in doing obeisance to the idols of the comparative advantage theory, when those who own those temples swear by the cartel theory? What value when they often draw cheques for the delivery of air, and the strategic reserves end up being perennially empty?

What value is there in government purchasing (highly expensive) local grain at prices that are even higher than the local market price, only to spend billions more in consumer maize subsidies? Isn’t sticking to maize like white on rice a bad habit that Kenyans would want to kick?

How far over the edge would the seven year itch tip our economy should the seven lean cows eat up the seven fat cows? Is there any other nation on earth that hates itself this intensely?

3 comments on “Seven Fat Cows, Seven Lean Cows and the Kenyan Maize Conundrum

  1. Worth reading.

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