Is Machakos City A Pipe Dream? My Thoughts On Machakos County Development Plan

There are many reasons why the hyped Machakos County Development Plan by Dr Alfred Mutua could fail, and we all know them. We all know that the governor is good at PR, and the Machakos City plans are probably more hype than substance.

I however believe that are certain things the Governor and his cabinet (which seems very able and active) are putting in place that could make Machakos the next Nairobi. The Machakos Government Policy has several focus areas (food production, youth empowerment, water, education and welfare, health, railway and airport link, energy, sand harvesting, security and mdern and clean efficient markets). I am interested in the industrialization bit (where the city comes in), and therefore may not be able to explore all the focus areas. I will also try evaluate the contentious issues, and the “Mutua is all about PR” critique.

Background

Machakos County borders Nairobi County and is about 40km (or less) from the Nairobi CBD. It is made up of 8 constituencies, has a population of about 1 million people, and an area of 6,208 KM SQ, making it a relatively sparsely populated county. It is largely semi-arid, and subsistence agriculture is the main stay of the residents, who depend on drought resistant maize and sorghum. In terms of natural resources, Machakos County is not very well endowed but it has sand and stone quarries. It however has certain advantages which I believe are key to its success:

Proximity to Nairobi City, which is becoming less attractive to residents and investors due to poor planning, high land and property prices, high cost of labour and insecurity
Relatively low population of very resilient people who survive through the toughest of droughts, and low crime rates. The people matter.
Availability of vast land for cultivation and development
Potential for local and international tourism

The County Development Plan

Machakos County has been in the news since the launch of the ambitious development plan which includes a city (see the master plan on their website). In my opinion, a city is not the fancy looking buildings, a city is built on a solid economic base. In my critique of Konza City, I wondered if the government has a solid financial basis for investing in a city. The fact that Machakos is keen on industrial / manufacturing investment gives it a more solid (and long term base) than an IT city. Why is manufacturing attractive?

We all know that Nairobi’s Industrial Area is no longer attractive to investors because it is crowded, has poor roads,poor security, no housing for the workers etc. We also know that the central government is keen on value addition and growth in industrialization.
We also know that Kenya is still an interesting destination for manufacturing industries looking to set up in East Africa.
The growing middle class and the trend towards consumption means manufacturing will continue to grow (especially if the central government invests in making it attractive to manufacture in Kenya).
Finally, we know the Chinese are in town. I don’t like them because I would rather we built our manufacturing capacity, but we know they’re good at production.

Dr Alfred Mutua is looking to attract local industries that are frustrated in Nairobi’s Industrial Area, and foreign manufacturing entities that want to set up in Nairobi, and he has several initiatives and incentives to do this:

Free land: To me, that is neither here nor there. Land in Machakos is cheap as it is, and would be an insignificant cost for anyone looking to make a serious investment. While this has received the most airtime in the media, it is a non issue for me. I like that the National Land Commission will be involved in the administering of the individual investor land rights, so it’s not as whimsical and frivolous as the critique has made it to sound.
Investment in security: Machakos County is investing in 150 motor vehicles (I’m glad to see they’ve allocated some money for maintenance of said vehicles), and CCTV cameras in the town to improve security. To me this stands out as proactive. Machakos isn’t known for high crime rates, but anticipating increasing crime as the area develops is impressive foresight.
Licensing and Permits: The County has set up a one stop shop for licenses and permits to set up a business. Well, compare that with Nairobi’s messy licensing system.
Infrastructure development: According to this interview, they’re looking to get into BOTs (Build Operate Transfer) with investors to set up proper infrastructure in the county. We can debate the economics of a privately owned high speed trains, but for now, I think working on good roads will be good enough for the county.

It is interesting to note that the county has already signed MOUs with several organizations:

– Stimaken – A French solar panel manufacturing company

– Jet Industrial Park

– Devki steel mills which wants to set up a plant in Machakos

– East African Portland Cement

– Silver Corporation – a real estate company that wants to invest in low cost housing and a 3-star hotel

– Nairobi Hospital wants to set up a Kshs 2.4 billion research centre

MOUs do not always translate to solid investment, but the kind of organizations they’re in talks with sound interesting and you can see why each of the above companies would be interested in Machakos.

Challenges

In trying to make Machakos an industrial city, I feel Mutua will have to contend with power costs which have kept increasing. Machakos doesn’t have the resources necessary to have a power generation plant, and solar power isn’t viable for industrial use.

While free land is seen as an incentive, some investors may balk at taking freebies from the government if they come with strings attached. In my opinion, it is much better to work on laws that ensure contract enforcement is guaranteed, property rights protection is assured, and freedoms are not curtailed should there be unrest in the country.

Central government disincentives is another challenge. As much as our leaders are touring the world wooing investors, doing business in Kenya is getting harder by the day. Power costs as mentioned above, punitive taxation and corruption continue to discourage local manufacturing. Machakos won’t be insulated from that.

Common Critique

Free land?!!!! – This has received most airtime in all media. Land is a contentious issue in Africa, but this is actually not the first time a government is offering free land to investors. Is it a clear advantage? Not really. Evans Kidero also said he is going to give free land to investors. Less hullabaloo there from the locals, I am inclined to believe that the Machakos land hullabaloo is more about local politics, not genuine concerns. Well, like I wrote above, free land in Machakos is neither here nor there all factors considered.

Mutua is all about hype – The Governor is great at PR so yes, this could be a lot of hype and no substance. However, looking at what he has done since March and comparing it with his fellow governors, I am inclined to believe something good will come out of his governance.

– His cabinet is well qualified and seems to be working independent of him. We all know that most good managers hire people smarter than them to work for them, he has done that. I however wish he would upload his cabinet members’ CVs, trying to dig up their professional history is a bit taxing. –

– During the planting season, the County supplied free seeds, tractors to be used to plough land free of charge, and distributed 2 million chicks to farmers. Free stuff doesn’t work in the long term, but that is a good fix in the short term, considering that food insecurity in Ukambani is partly as a result of poor farming and food preservation methods. Long term, he will want to think about water supply and promotion of irrigation. Israel has thrived, so can Machakos.

– The County has procured 70 ambulances and 150 police cars to help improve security and health in the county. A good start.

– Launching of MACHAWOOD to promote the local film industry. We have good TV content in Kenya (I’m comparing with Nollywood), I think government support will go a long way in making this industry thrive. Mutua has experience in this, his TV series Cobra Squad was the first to do serious product placement on TV, everyone followed. Not forgetting that the latest viral video in Kenya is from Machakos County.

[youtube=http://www.youtube.com/watch?v=xrKHPSr8-ss&w=500]

– Machakos is set to host CECAFA games, the photo below says it all. The stadium was dry dusty grounds 5 months ago, it has been upgraded to national stadium status. What tangible change has your governor brought to your county?

So yes, there are many reasons why Alfred Mutua’s dream could fail, but like my headmistress used to say, aim for the stars, if you miss, you will end up on the moon. A city is the main focus because it sounds good, is glitzy and glamorous and we like glitzy and glamour, but I would focus on the small things. It is the small things Machakos County is doing will add up.

Ok, let’s hear the arguments in the comments section!