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End poverty by 2030? Forget it … UN says the fight will take longer

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Kenya is still millions of miles behind in its walk towards poverty reduction with the 2030 deadline way off target, says the United Nations Economic Commission for Africa (ECA).

The current rate of one person per minute escape from extreme poverty falls below the target rate by close to 30 per cent, leaving some 7.97 million Kenyans still struggling to make ends meet as at this month.

The extreme poor reduced by about 510,000 from a similar period last year, while about 2.7 million Kenyans are likely to be worse off by 2030.

Poverty elimination has been among the key commitments made by successive regimes since independence but remains a moving target with increasing population and economic headwinds complicating the issue.

Oil exporters
Only Zimbabwe, whose current escape rate is three people per minute against its target of 11.4 per cent, Mauritania — where the escape rate of 1.8 exceeds the target 1.4 — and Gambia, where the rate remains 1.7 against the targeted 1.8, are on track to eliminate extreme poverty by 2030.

The continent is, however, facing shocks, including the current Covid-19 pandemic, which is likely to hit economies hard.

ECA says the pandemic is disrupting global supply chains — drop in value creation, slowing down investments and has hit tourism with oil exporters’ revenue losses likely to hit $65 billion

Increased spending on health and further revenue loss is also likely to lead to unsustainable debt and reduce efforts towards poverty reduction.

Protect jobs

“As a safety net, these countries should provide incentives for importers to quickly purchase to ensure sufficient reserves in key basic foods and prepare fiscal stimulus packages (eg guaranteeing wages for those unable to work due to the crisis, favour consumption and investment and maintain infrastructure investments to protect jobs,” ECA said it is latest update on poverty reduction and effects of the coronavirus.

Poverty is still on the rise in South Africa, with more people sliding into the bracket of the extremely poor and the rate of reduction remaining negative five against the target of 141.4 people per minute.

Kenya conducted its second integrated household budget survey (hbs) in 2015/16 with those classifieds as under hard-core (extreme) poverty said to have declined significantly by more than half from 19.5 per cent in 2005/06 to 8.6 per cent in 2015/16 with about 84 per cent of the total hard-core poor found in rural areas.

Kenya defines the extreme poor as households and individuals whose monthly adult equivalent total consumption expenditure per person is less than Sh1,954 in rural and peri-urban areas and less than Sh2,551 in core-urban areas.

In figures
THOSE WHO MADE IT IN BIG 2019

About 510 million people cut themselves loose from extreme poverty last year with more than 2.7 million still expected to be struggling by the 2030 deadline.

Over eight million Kenyans are firmly in the shackles of extreme poverty, according to the latest figures.

BY Nation.

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Business

Govt demands answers from Fairmont after mass layoffs

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The government has demanded answers from Fairmont Hotels on its reason to sack all staff over what it attributed to uncertainties of the coronavirus pandemic.

The hotelier that runs Fairmont the Norfolk and Fairmont Mara Safari Cub said on Wednesday that they have ceased operations as a spiral effect of the Covid-19 pandemic and the recent flooding of Fairmont Mara Safari Club.

In a letter addressed to the Country General Manager, Mehdi Morad, Solicitor General Ken Ogeto on Friday, said the move by the hotel has generated a lot of public interest especially after some of the employees petitioned his office saying the due process was not followed.

“This matter is of public importance and great concern to the government and in view of the Attorney General’s mandate to promote, protect, and uphold the rule of law and defend public interest, this office should be very grateful if you would provide it with clarification regarding the said media reports and complaints from employees including on the veracity thereof and justification for taking such action, if this is the case,” Ogeto said in a letter dated May 29.

Declare all positions redundant

Ogeto noted the move to declare all positions redundant would have far-reaching consequences on the welfare of the employees and the country’s economy.

“This is therefore a matter of profound public interest, in respect of which this office demands a response,” he added.

In a memo to staff, the country manager said, owing to the uncertainty of the direction the global pandemic will take, they have been forced to terminate employee contracts and close their properties.

“Due to the global Pandemic will result in the business picking up in the near future, we are left with no option but to close down the business indefinitely,” Mr Morad said in the memo.

“It is therefore the decision of the management to terminate the Services of all its employees due to “frustration” by way of mutual separation and taking into account the loyalty and dedication the employees have put into the success of our company in the previous years.”

Employees will receive their termination letters by June 5.

All major hotels in Kenya have remained closed since mid-March when international flights were suspended and movement restrictions imposed by the government to curb the spread of Covid-19.

BY NN

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Why Coca-Cola won’t take her

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Coca-Cola Company on Monday bowed to online pressure and stated their position the little girl from Baringo who warmed many hearts with viral photos of her joyfully sipping a Coke drink.

The pictures of four-year-old Joy Jebiwott, in a traditional African set-up,  said to have been taken by Daggy Shy, a Baringo born photographer, prompted Kenyans to launch an online campaign to have the multinational soft drink giant adopt the girl as their brand ambassador.

However, the company, in a statement, said they have a policy of not using anyone below the age of 12 years in marketing.

“This is pure happiness. You’ve made us smile by sharing this beautiful image. As a company we have made a decision not to use children under the age of 12 in our adverts and marketing worldwide, but we do love seeing the creativity and passion for our brand,” the company said in their statement.

Earlier, the father of the girl had expressed his joy with the viral photos saying he has no reservations with the company working with his daughter.

BRAND AMBASSADOR

“If it is possible for her to be made a Coca-Cola brand ambassador, it is okay,” Jacob Keror, the father of the girl stated.

The firm’s responsible marketing policy clearly states out that they do not design their marketing communications in a way that directly appeals to children under 12.

“Specifically, we will not use, in any communications created after the date of adoption of this policy: Celebrities or characters whose primary appeal is to children under 12, with the exception of brand equity characters already in use…Licensed merchandise whose primary appeal is to children under 12. Images of our products being consumed by children under 12 without an adult present. We will not feature any children who are, or appear to be, under 3,” Coca-Coca policy published on their website states.

By Nairobinews.nation.co.ke

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How illiterate boys from Rwathia village built Business Empire worth billions

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In the 1930s, a bunch of poverty-stricken boys from Rwathia village in Kangema, Murang’a County, walked to Nairobi with nothing but tattered clothes and a burning dream to find that elusive thing called mbeca (money). Little did they know that they would make tonnes of it.

Eighty years on, the value of property owned by the Rwathia businessmen in Nairobi, Thika, Murang’a and other towns runs into billions of shillings, with their billionaire sons and protégés control substantial wealth at the Nairobi Securities Exchange.

The tough-as-nails capitalists from Rwathia provide a story of unrivalled dedication, passion and inspiration that enabled young boys, most of whom are now deceased, to transform their lives through hawking vegetables, selling charcoal and wattle bark, setting an example in ambition, personal discipline, frugality and entrepreneurship for generations.

Gerald Gikonyo Kanyuira, over 100 years old and still counting, is the only remaining patriarch of the great capitalist boys from Rwathia village that produced the legendary Rwathia Group of entrepreneurs, who control a swath of properties and businesses in downtown Nairobi.

As an indication of the sheer determination of the boys from Rwathia, at 102 years, Gikonyo, who once employed Equity Chairman Peter Munga as a casual labourer in one of their hotels, still supervises several businesses owned by the various groups from Rwathia.

The journey to massive wealth for these exceptional entrepreneurs started in 1930 when a group of boys came to Nairobi and set up a vegetable hawking business.

“We would buy the vegetables from Marikiti (Wakulima) Market from traders from Limuru, and sell them to Asian families,” said the father of 23 and husband to four wives who first worked as a farmhand in a Nyeri coffee plantation.

Some of the properties owned by Rwathia Group.

Since there were no banks for Africans then, the boys would send one of their friends back to the village to deliver some savings for safekeeping by the elders. When the boys in the city needed to increase their investment, they would go back to the village and get their savings. This cycle had a ripple effect. Seeing how their peers were able to save money, more boys from Rwathia were encouraged to go to the city and start similar or different businesses.

“There was a wave of boys from Rwathia coming to Nairobi. We encouraged it because we all wanted to do business together,” recalled Mzee Gikonyo, whose first child was born in 1936 and his last born 36 years later.

It is then that the Rwathia boys decided to form several savings groups and one person would belong to several of them. After seven years of selling vegetables and doing other businesses in Nairobi, the savings groups started buying buildings from Asians in Pumwani to set up shops and small dukas.

A group of five to 12 people would buy one shop and jointly start a business. The Asians were selling the shops to move closer to the city centre.

In 1952, the groups decided to start buying plots, on which they built residential and commercial buildings. But this new investment was disrupted the following year when the Mau Mau insurgency saw Kikuyus in Nairobi hounded and repatriated to restricted areas known as ichagi (villages).

The period that followed was of sheer destruction by the British colonialists. They particularly targeted Kikuyu-owned businesses as they suspected they were part of the Mau Mau support base. All that the Rwathia boys had built was razed to ashes.

Some of the properties owned by Rwathia Group.

By 1957, the Mau Mau war had slowed down because it was taking a toll on both combatants. The colonialists called for amnesty and began allowing some Kikuyus who had businesses back to Nairobi. The boys from Rwathia, now seasoned businessmen, took the offer and decided to up their ambitions.

“When we returned, we decided that we would henceforth enter the city centre, where we were not allowed before. Our idea was to rent buildings and start businesses,” said Mzee Gikonyo, who prefers boiro to roast meat.

“But most of the buildings we wanted to rent were owned by Asians. They were fearful of the Mau Mau, so many of them were migrating from Kenya and selling those buildings. This is how we started buying some of the buildings that we still own to date.”

“Again, we started buying in groups as we had done in Pumwani and Majengo. As many as 30 people would buy one building. All the small savings groups from Rwathia worked in harmony. So you would find one person owning shares in several groups. It was the best thing we did for ourselves,” explained Mzee Gikonyo.

Today, the Rwathia groups control prime properties in Nairobi, especially within areas on the east side of lower Tom Mboya Street, Ronald Ngara Street, River Road, among others, besides the beer distribution outfit, Rwathia Distributors.

Buildings and bar and restaurants like the famous Magomano, Kinangop, Njogu-ini, Eureka, Timboroa and Alfa Hotels, among others, are all owned by several savings groups from Rwathia.

“The big lesson that we learnt and which we would want generations to understand is that one cannot achieve much alone. It is important to cooperate, even if it is with your wife,” said Mzee Gikonyo.” People should come together. This is what I tell young men from Rwathia.”

He added: “We succeeded because we had passion for our businesses. It is important for people to have passion for what they do even if they are employed. If one is not passionate, it is better to resign than spoil other people’s business.”

According to Mzee Gikonyo, the Rwathia groups thrived on trust. “Each group would pick one of them to manage the business. Every month, members of the group come to inspect the financial books. At the end of the year, we divide the profits or re-invest,” said the man whose village founded an empire.

By SDE

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