A Political Kenya: Latest Politics and Kenya Economy News

The law of contract is clear that critical agreements are never cast in stone.

"No enterprise is so seductive as a railroad for the influence it exerts, the power it gives, and the hope of gain it offers"
Poor's Manual of Railroads, 1900 Edition

From the night of July 18, 64 AD and for next five days and nights, 11 out of 14 districts of the City of Rome burnt whilst Emperor Nero was watching from his palace balcony and playing his fiddle to the tunes of the epic and ancient Greek poem Illiou Persis.

Nero, who was a tragic leader, may have caused the fire to blame it on the Christians as their massacre followed thereafter. The citizens of Rome could not stand up to Nero and neither were his courtiers.

The tragedy of Romans in the time of Nero has afflicted nations to date. We fear to stand up and let the fire rage, yet the fire will ultimately reach us.

Fires are raging in our country in various forms: the ghosts of Goldenberg and Anglo-Leasing, the dodgy presidential results announced by the Electoral Commission, the post-election violence, stillborn constitutional reforms, the suspect sale of Grand Regency and of course the concessioning agreement of Kenya-Uganda Railways.

Written speeches

Amidst all these, President Kibaki never uttered a word except to issue written speeches or form commissions. Maybe he is not seeing the fires burning.

Kenya-Uganda Railways stands as a monument of both historical and economic significance and also for the shame it represents.

Between May 30, 1896 and December 19 1901, Indian expatriates under supervision of the British masters, braved the elements, diseases and wild animals to build the railway line from Mombasa to Kisumu. Thereafter, a 10km railway line was built between Port Bell and Kampala in Uganda.

We call the railway, Kenya-Uganda yet Uganda initially got only 10km of it. Later the line was extended in both Kenya and Uganda to include some towns in the interiors. Since then, the railway line has neither been expanded nor modernised.

Our railway line still has the gauge system built in India in 19th Century and is not compatible with the rail systems of our neighbours or rest of Africa.

By series of agreements, the governments of Kenya and Uganda agreed to surrender the management of Kenya-Uganda Railways to RVR Investments (Pty) Limited through its respective local affiliates, Rift Valley Railways (Kenya) Limited and Rift Valley Railways (Uganda) Limited (the said company and affiliates hereinafter called RVR).

In the agreements, RVR was granted the authority to use the railway lines for both passenger and freight transport for an exclusive period of five and 25 years respectively.
The agreements they seem, locked respective governments into a non-divorce relationship till the expiry of the contract period. In fact, if there is any dispute, the parties can only go to arbitration for resolution. There is no termination clause. And if still the two Governments are not pleased with the services of RVR, the agreements say that they are free to set up alternative lines. What a mischievous clause!

By mistake

My proposition is that the governments of Kenya and Uganda not only terminate the contract, but also set up new lines. The two can be done same time.

On the issue of termination, RVR as the concessionaire undertook that it shall offer the said rail services with clearly set-out bench-marks of "... reliability, safety, environmental protection, economy and expedition...". In the entire period RVR has been running the railways, has it achieved or even attempted to achieve these benchmarks?

The law of contract is clear that contracts are never cast in stone. Parties may enter into contracts without termination or revocable clauses, but the law is wiser.

Contracts can be set aside if either side to the contract can show that the contract was entered by mistake, fraudulent representations, absence of consideration, frustration or non-performance of the contract. If the two governments want a reason to terminate the contract, they can get 1,000 reasons. RVR should therefore be issued immediately with termination letters by Nairobi and Kampala.

For developing economies like those of Kenya and Uganda that are based on export of raw and bulk goods, the railways is a lifeline. Kenya, Uganda and Rwanda are their own biggest trading partners and an inefficient or collapsed railway system has a catastrophic impact. No modern economy has developed without a developed rail system. Railways have always generated and spawned direct and indirect employment, growth of towns and populations along the routes.

Further, railways have played a catalyst role in providing platforms and opportunity to advance engineering technology, business management and trade unionism; all essential factors in economic development.

While we are still operating a railway system that hasn't changed for over 100 years, railway systems of other countries have moved on. Germany, France, China and Japan have moved to the next level and are now operating magnetic levitating (Maglev) ones.

In developing new technology for their rail systems, these advanced countries develop technology that benefits other sectors. Technology is not exclusive to one area.
Kenya-Uganda Railways having remained stuck in history is not benefiting either country or its people. We cannot aspire to want to be a middle-income economy in a generation when we still operate outmoded and out-dated non-technology rail system.

As it is, RVR has not introduced new technology or innovative management style. Instead, the media treats us to broken-down wagons, uprooted rail-lines and staff forever on strike. Kenya-Uganda railways is a study in how not to run a company.

Kenya, Uganda and Rwanda have to make a strategic decision and now to lay new and modern railway line stretching from Mombasa or Lamu to Rwanda's border with DRC Congo.

The benefits that shall accrue to the three countries cannot be gainsaid. Financing the line need not be 100 per cent government-funded. Public-Private Participation ought to be used. England, the mother of modern railways has spanned off the management and running of its rail system to local players.

The rail-system though continuous is actually owned in sections through franchising the way McDonalds is run. Germany has also done the same but allowing private companies to actually own the lines and services.

The economies of Eastern Africa cannot grow even if we wish it unless our transportation sector is working.

A study in contrasts proves this correct. DRC Congo sits on the world's richest minerals yet its economy is in dark ages because its political leadership from Belgium (its colonial rulers) to Joseph Kabila now has never seen it fit to develop the transport system.

America laid the foundation of its modern economy in the development of its rail system in the first part of 19th Century. East Africa has to choose on the choices taken by either DRC Congo or America.

Our Vision 2030 gives us clear road-map on the way forward. The vision will be that, a vision, if we cannot fix our railways. Till such time that our economies will be non-transport based, we do not have alternatives.

Transporting our coffee, tea, soda ash, cement and passengers demand efficient, reliable and working rails. Our roads are dilapidated to withstand extra burdens imposed by a broke rail system.

Nations demand visionary leadership from those it has chosen to lead them. In its current edition, TIME has its lead story on the secrets of Mandela's leadership and why he remains an icon and a living saint. Richard Stengel, its managing editor, who wrote the article, says that in Mandela, "courage is not the absence of fear - it is inspiring others to move beyond it."

Mwai Kibaki, Yoweri Museveni and Paul Kagame have an obligation to the people they govern to lead us to material prosperity and happiness. Constructing a new railway line will be a fundamental and primary step.

Meanwhile, RVR ought to receive their termination notices and the boys of Kibera allowed to legitimately pull out the railway line to give way to a modern one.