Op-Ed: Konza Needs Policy Modernity, Not Bricks
Wednesday, 30 January 2013
The pursuit of integrated tech parks is nothing new. From Asia-Pacific to Latin America there have been many such endeavors, most of them biting dust owing to an unfettered ambition that investors would waltz in and create jobs so long as basic infrastructure   glass buildings, bandwidth, coffee shops and cosmopolitan gastronomic choices   was made available. But emphasis on just the ICT sector (and in Africa's context the BPO industry) as the quick way out of poverty and structural imbalances are quite misplaced and short-sighted.

Taking a leaf from the lesson that the Chinese learnt in 2011, that a ‘Build and they will come’ policy is unsustainable, Kenya would also do well to remember that provisioning a USD10bn technopolis will do nothing but increase the envy amongst the have-nots (particularly folks living in slums whose collective economic contributions do not matter much to the national economy, but whose woes are significantly concerning to the national agenda). These concerns need to be addressed upfront than trying to pursue a cause that has no takers at the present moment.

The ambition to become Africa’s hub remains just that, alongside similar ambitions harbored by nations like Tanzania, Ghana, South Africa, Senegal, Mauritius and Uganda. The only nation that has perhaps come closest to proving itself worthy of that leadership role is Mauritius, given its significant investment in the building blocks that make up for commencement, and sustenance of a robust industry.

Kenya’s ambition with the technopolis seems to be shrouded in rhetoric similar to what the Chinese had peddled all along. The reality is plain and visible to see – built and empty tech parks that cost upwards of tens of billions of dollars each (and there are more than 50 such parks in Eastern China alone). The question is not about fancy buildings or guaranteed services that the rest of the nation does not enjoy (like bandwidth, clean roads, sewage and water facilities etc). It is the availability of an ecosystem that can manage itself within the boundary conditions established by the building blocks: policy modernity, alignment of educational systems to present corporate realities, availability of labor (not just parading a sizeable unemployment ratio as readily available labor pool), recourse to law, protection of IP rights, leadership and knowledge of managing corporate entities handling global delivery environments et al.

A tech park is just that – an empty shell that needs to be filled. A knowledge economy is created by pursuing knowledge in the first place, not just pushing physical infrastructure that is perceived as a magnet for knowledge creation. If that were the case, some of the most imaginatively built and lavishly equipped universities in the GCC would be promoting their coveted status as among the best institutions in the world. Unfortunately they are still eons away from the reality that one sees at Cambridge, Oxford, Stanford, or Harvard. This is the reality.

While it is laudable that Kenya’s ambitions are big, the reality of the current BPO industry within is of significant concern (to say the least). It is not even considered sizeable enough to warrant any mention, and that should be the biggest worry for policy-makers and ministry officials in the first place. Domestic consumption should take precedence over attracting MNCs. Gone are the days when one could build the industry based purely on service exports. Further, it is crucial to look at the structure of the nation’s economy, its dependence on key sectors and how such sectors will enhance or erode the nation’s GDP going forward.

One excellent example of nation-building is to look at the Iskandar Development Region (IDR) in Malaysia, an integrated city thrice the size of Singapore. The emphasis was not on just the basic infrastructure and sizeable marketing. The initiative was based on effective planning to nurture, create and sustain core industry sectors – media/ entertainment, oil & gas, technology/ manufacturing, Islamic financial services, business services etc – supported by an independent regulatory authority, enhanced by appropriate policies/laws (for e.g. preferential income tax rates to employees working in this region, to custom incentives for specific projects aimed at specific sectors like the fiscal support provided to Legoland, or to Pinewood Studios) that helped create a significantly sustainable environment where investors are flocking in, and consequently creating those jobs that makes or breaks any nation’s aspirations.

The promise of cheap labor or tax holidays is not what attracts investors anymore. What made IDR successful is the availability of a holistic environment that was planned in advance to support a sector’s growth. Kenya needs to be doing that precisely. It would be foolish to imagine that the fortunes of over half the nation’s population that is currently unemployed would be transformed overnight by spending precious monies on a technopolis (which would apparently create 200,000 jobs in the ICT sector).

The key question for policy makers in the nation is this: Do you think that your economy will depend only on the ICT sector going forward? An affirmative answer would be both naïve and immature. I don’t think over 15 million Kenyans are going to get jobs in the ICT sector anytime soon. The government would do well to invest in productive and sustainable endeavors that can collectively contribute to the nation’s growth across key sectors where all can find gainful employment.



 About the Author


Bobby Varanasi is the founding Chairman & CEO of Matryzel Consulting Inc. With over 15 years of experience in the global services industry, he advises federal governments across four continents on ICT sector development with particular emphasis on policy development, industry-government partnerships aimed at creating GDP growth and enabling positive economic impacts for countries like Jamaica, Brazil, Sri Lanka, Malaysia etc.



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