“Kenya: The Economic Stake of the Kenyatta Family; The Royal Family Jewels” – that CIA report after Jomo’s passing

Below I have embedded for downloading the 1 September 1978 CIA Africa Review which covers at pages 12-18 “The Economic Stake of the Kenyatta Family”.  This is related to the story in The Standard noted in my post Standard covers newly declassified CIA report on Kenyatta family wealth acquisition during Jomo’s rule.  I thought you should read it in full for yourself:

1 Sept 78 Kenyatta wealth – The Royal Family Jewels

 

Podesta Group lobbies Washington Post, New York Times, Politico, Roll Call, Foreign Policy, Guardian, Financial Times, Reuters, Washington Diplomat for Kenyatta Gov’t

Kenyan taxpayers paid The Podesta Group of Washington, DC for public relations/lobbying contacts with these media outlets on behalf of their Government in the first half of 2015.  The Podesta Group provided similar or related lobbying services at the same time for the governments of Azerbaijan, Myanmar, Iraq, India, and Vietnam, among various others, aside from their nongovernmental clients.

I’m certainly not suggesting that there is anything wrong with the Government of Kenya spending tax dollars on working media contacts when it isn’t paying teacher’s salaries or meeting basic human needs in health care, for instance.  After all, the United States and various multinational and other foreign donors can be counted on to spend their taxpayer dollars to help ameliorate the consequences of this choice by the Government of Kenya.

dnagenda40503rt

Having apologized for having gotten our shoes in the way of the vomit, donors to Kenya’s government are now finally alarmed again about the (ongoing) corruption

Here is the latest from Kenya’s Journalists for Justice on the corrupt involvement of personnel in the Kenya Defense Forces in the charcoal and sugar smuggling trade.

It’s not so much that I’m jaded, it’s just that I have watched this movie before–and even been an “extra” of sorts in one of the previous remakes.

Yes, corruption is obviously getting even worse within this Kenyan administration than within the last.  But that was also true when I lived in Kenya during the end of the first Kibaki administration and into the beginning of the second.

There are several readily apparent reasons.  For instance, when I lived in Kenya I made the acquaintance of a Western expat whose spouse was in the tourism business. Prior to the 2007 vote count corruption and violence, the tourism business was booming.  But corruption was up as a cost of doing business as it was explained to me because to operate you had to pay off a second generation, too–the kids of the senior politicians.  Presumably this generational expansion has continued.  Why wouldn’t it?

The year before I moved to Kenya the UK and US envoys had been outspokenly opposed to the corruption, in the context of the Anglo Leasing revelations by John Githongo of massive corruption involving national security procurements, touching our own security interests aside from our sensibilities about criminal behavior, along with the outrageous shenanigans involving the Artur Brothers, and the Standard media raid, among others.  The British envoy even offered the memorably colorful “vomit on our (the donors’) shoes” metaphor about the extent of the gluttonous “eating”.

But by the time I arrived in mid-2007 things were different.  New personnel led the diplomatic missions.  On the US side we apparently helped Moi and Kibaki get back together, and hosted Interior Minister John Michuki, of “rattling the snake” fame, who had taken credit for the Standard raid, on a security tour of the U.S.  Michuki represented Kibaki at our Embassy’s Fourth of July party, where Moi unofficially planted himself to catch the receiving line.

And then we looked the other way at the corruption of the Electoral Commission of Kenya.  Ambassador Ranneberger made sure to get his predecessor Ambassador Bellamy removed from our IRI Election Observation Mission on the basis that he was “perceived as anti-government”.  Bellamy had spoken out on the corruption, in particular the Standard raid.  The week before the vote, Ranneberger noted for the Kenyan public that Kenya was “on track” in fighting the vice of corruption, that  we had had Enron in the U.S., that prosecutions for Anglo Leasing and Goldenburg could take time, and that the World Bank had given the Kibaki administration an award for procurement reform (of all things) and that he expected a “free and fair” election.  And then we tried at first to sell the ECK’s election “count” even though we knew full well that it was bogus.  When that didn’t fly, we supported “power sharing” so long as there was no new election before Kibaki’s full second term was up.  According to a news report from Nairobi years later from stolen cables from “Wikileaks” we issued a couple of “travel bans” based on alleged evidence of bribery against two of the ECK commissioners, but we never disclosed this action or the evidence, why we singled out these two or anything else about the matter.

During the post election violence a diplomat explained to me that the reason many of the younger pols in Kibaki’s PNU coalition were against a power sharing settlement was that they didn’t want to share the secondary ministry appointments.  Ultimately by adding opposition politicians into the second Kibaki administration through “power sharing” with extra ministries you further expanded the multigenerational set of stomachs to let eat.  One way to look at the settlement naturally has been that Kibaki and Raila were willing to stop the fighting (so long as Kibaki retained with further ambiguity the full second term Presidency which the ECK had delivered to him) and the rest were bribed to acquiesce.

So you cannot tell me with a straight face that the diplomatic position of the United States in 2007-08 was to “oppose” corruption as a high rather than a subordinated priority.

After being stung by criticism from the election debacle, Ranneberger was reborn as an outspoken “reform agenda” campaigner for his extended tour on through the passage of a new constitution.  He compiled dossiers on money laundering and drug smuggling through politico/business interests and encouraged action, albeit to no avail. His successors quietly moved on, however, and we helped sell a new badly handled election in 2013 by a new, but probably more pervasively corrupted electoral authority.  We helped pay for expensive technology that was doomed by procurement fraud but kept quiet.  The British Serious Fraud Office successfully prosecuted one of their companies and its owners for bribes on other election procurements, but the Kenyan administration has taken no action to follow up and we have kept our silence.

With time, we have come again to affectionately embrace our usual suspect “partners”, with new programs headquartered in our favorite African city of Nairobi.  A photo op in the Oval Office with POTUS and FLOTUS for the Kenyan President and First Lady last year, followed this summer by a glowing official Presidential visit to Nairobi with a telegenic dance party at State House.   Never mind what we said before; please can we give you more?  Some eloquent speech about the cost of corruption, safely abstract from the burgeoning accumulation of years of specific cases on the impunity docket.  Yes we can dance with this new set of shoes without even looking down at the vomit.

Surely then it can be no surprise that things have gotten that much worse.  With a new report by Kenyan journalists on the longstanding implication of Kenyan Defense Forces which we help underwrite in Jubaland in the sugar and charcoal smuggling rackets, and fresh levels of embarrassment from the international press from the National Youth Service, irregular handling of bond proceeds amid rising debt levels, more land grabbing and another looted bank, all with a new election cycle approaching, the season has turned again and it is the time for furrowed brows.  Time for the U.S. to lead a donor group to call on the current version of the anti-corruption authority.  To talk again of “visa bans” and offers again to assist in “asset recovery”.

Instead of another remake, could this be a sequel offering a surprise ending, with say, even a few villains in jail, or at least less rich, as a cautionary tale for some and a bit of hope and inspiration for others? Or is this just another iteration of “the formula” in which the sheriff rides into town, frowns at the drunken brawl, then passes along to enjoy the cinematic scenery on the way home?

Only time will tell.  I do think we genuinely would prefer to be against the corruption rather than aligned with it.  We just lose our nerve and get distracted by other priorities that seem more immediate.  Making a dent in Kenya’s entrenched culture of impunity would take a long hard slog, in the face of bitter opposition formal and informal.  It would be messy and likely involve putting up with a bit of embarrassment–it could involve some risk and actual cost.  In any event  it would take a good while for us to convince the players that we had become serious.

Are the Goodyear bribes in Kenya, as disclosed in US Foreign Corrupt Practices Act case, disappearing into Kenya’s “black hole” of impunity?


tyres in Lamu

Tyres in Lamu


From Nairobi’s Business Daily of February 26, 2015, “Big names face scrutiny in Goodyear bribes scandal“:

Top Kenya government officials are on the spot once again for pocketing more than Sh138 million ($1.5 million) in bribes from a subsidiary of American tyre firm Goodyear Tire & Rubber Company, US regulators said.

The bribes were paid in exchange for the award of multi-million shilling tenders to supply tyres to some of Kenya’s largest state corporations, government agencies and public listed firms.

The US Securities & Exchange Commission (SEC) said Goodyear paid the bribes to Kenya Ports Authority (KPA), Armed Forces Canteen Organization (Afco), Nzoia Sugar, Kenyan Air Force, Ministry of Roads, Ministry of State for Defence, East African Portland Cement Company (EAPCC) and Telkom Kenya executives to win contracts.

US detectives also established that additional Sh1.3 million ($14,457) was dished out to lure Kenya Police and City Hall officials to award the Ohio-based tyre maker multi-million shilling deals.

The corrupt dealings, committed between 2007 and December 2011, were executed through Treadsetters Tyres Ltd, then a subsidiary of Goodyear.

Goodyear made the illicit payments to Kenyan officials in cash and recorded the spending in its financial books as advertising expenses, according to a forensic audit by the SEC.

“Treadsetters’ general manager and finance director were at the centre of the scheme,” the SEC said in its filings. “They approved payments for phony promotional products, and then directed the finance assistant to write-out the checks to cash.”

The well-orchestrated bribery ring involving Kenyan bureaucrats is captured in a ruling in which Goodyear has agreed to pay a Sh1.48 billion ($16.22 million) fine for engaging in corrupt practices abroad.

The allegations were disclosed by Goodyear in 2012 and hit the Kenyan press in a significant way when the SEC fine was announced almost eight months ago.  Many of the disclosed bribes were paid to Kenyan national security officials.  In the meantime, we see more successful terrorist attacks and insecurity, but no further news on anything being done to suggest that the Government of Kenya has any substantive intention of treating these bribes as unacceptable.

Where is Kenya’s Ethics and Anti-Corruption Commission? Where are Kenya’s journalists and media houses in following the stories they reported? (would be pleased to hear if I’m missing something . . .)

And where is my government?  I’m proud of my country for policing our own companies through the Foreign Corrupt Practices Act, but it has been sad to see our support for a “reform agenda” in our relations with Kenya seem to run off into a ditch.

“Faded Aid”

Unnamed Kenyan officials figure in UN bribery charges involving “Chinese Security Company” seeking business with Kenya’s Interior Ministry

Kenya EACC

The criminal complaint unsealed yesterday by the U.S. Attorney for the Southern District of New York of six individuals, including John Ashe, the former President of the U.N..General Assembly, and five others involved in a bribery and money laundering scheme to illegally advance the fortunes of Chinese-based business interests, includes a section entitled “YAN and PAIO Arrange Additional Payments to Ashe in Exchange for Official Acts on Behalf of a Chinese Security Company”.  [See pages 26-30]

The “official acts” alleged involved Ashe acting on behalf of the unnamed “Chinese Security Company” as a go-between with unnamed “Kenyan Officials” to facilitate the pursuit of Kenyan Interior Ministry procurement.

Black Star News in New York also raises separate past but unanswered corruption questions involving Uganda’s Foreign Minister Kutesa who succeeded Ashe at the General Assembly presidency.

Update: Nairobi’s Business Daily has picked up the story.

So what matters in Kenya? David Ndii reminds us that most Kenyans do not have enough food . . .

Not to distract from the “news”, the big events like a second Nairobi Carrefour coming to Karen and competing with Nakumatt. . . but for anyone who is interested in Kenya and
has not actually lived there in recent years, I highly recommend David Ndii’s latest Friday column from Daily Nation, “On hunger, and a nation in need of a conscience“:

Hunger stalks this land. One third of the respondents to Ipsos Synovate’s latest opinion poll answered yes to the question whether they or other members of their households ever sleep hungry.

The facts are much worse that the poll’s finding.

The most comprehensive information on our food situation is in a report published by the Kenya National Bureau of Statistics in 2008 titled Food Insecurity Assessment in Kenya.

It shows that over half of Kenyans, 51 percent, consume less than what they require on a daily basis. They consume an average of 1,261 calories per day, against a requirement of 1,683 calories — a shortfall of 422 calories or 25 percent of the daily requirement.

Simply put, half of the country suffers from chronic hunger. . . .

“We see Africa’s potential”

"We see Africa's potential"

“We see Africa’s potential”

This week’s Africa Summit in Washington suggests hope for a deeper, broader engagement between the United States and many African countries. This is a policy area where there seems to be substantial room for negotiated agreement and cooperation between Republicans and Democrats. While there are things that I wish we would do differently, I am glad to see the effort and attention and I will watch with interest.

Uhuru Kenyatta, Jendayi Frazer and Paul Kagame walk into a commodity exchange in Kigali . . .

Swiss trader looks up and says, “You must be here to save Kenya’s small family farmers!”

Post-election IDP camp at Naivasha, Kenya, 2008

Post-election IDP camp at Naivasha, Kenya, 2008

“Could Rwanda’s Kagame get thrown out of the ‘smoke filled room’?” AfriCommons, 13 March 2014

“East Africa Exchange Formally Launched” BizTech Africa, 4 July 2014

“Carter Center release; Initial observations on the ‘Frazer v. Carson’ controversy”  AfriCommons, 21 Feb. 2013

“Beth Mugo Admits Kenyatta Family Owns Huge Tracts of Land, But Defends Uhuru” Mwakilishi, 12 Feb. 2013

“How Kosgei pulled strings to block U.S. from endorsing Kibaki presidency” Daily Nation, 13 July 2012

“Kenyan PM Odinga Speaks Out on Election, ‘Dubious’ Role of Jendayi Frazer and Ambassador” AfriCommons, 4 March 2010

Part Ten–FOIA Documents from Kenya’s 2007 election–Ranneberger at ECK: “[Much caan happen between the casting of votes and the final tabulation of ballots and it did” AfriCommons, 30 April 2012

“Africa Bureau under Frazer coordinated “recharacterization” of 2007 exit poll showing Odinga win (New Documents–FOIA Series No. 12)” AfriCommons, 18 March 2013

Kenya: Security, Corruption, Terror and Elections (and Railroads)

Nairobi Station - Rift Valley Railways

Nairobi Station – Rift Valley Railways

“On Security, Corruption and Terror Attacks” from the Mzalendo blog:

The link between corruption and the country’s susceptibility to is also recognised in the Parliamentary Report on the Inquiry into the Westgate and other attacks in Mandera in North Eastern and Kilifi in the Coastal Region. The report mentions systemic corruption and the link to terror attack stating:

“Corruption has greatly led to the vulnerability of the country in many cases including where immigration officials are compromised thus permitting ‘aliens’ who could be terrorists to enter the country and acquire identification. This enables terrorists ease of movement and are therefore able to plan and execute attacks without the fear of discovery. Further compromising of security officials enables ‘suspected individuals’ to fail to pursue suspected terrorists and enable them to secure early release when caught or reported in suspicious criminal activities.”

Of the link between Kenyan troops in Somalia and the increase in terror attacks in the country the report states, “It should also be interrogated why other countries such as Ethiopia and Burundi who had earlier sent troops to Somalia have not been attacked by the al-shaabab. Tanzania has also not suffered any terrorist attacks after the 1998 bombings. Is it because our security forces are weak, in-disciplined and easily corruptible?”

The report makes further note of nationwide systemic failure on the part of the Immigration Services Department, Department of Refugee Affairs; and Registration of Persons Department, also “rampant corruption by security officers and other government agents,” and  further that, “police officers are corrupt and lax too. They work in cahoots with alShabaab and are paid to pass information to the latter.”

Last week National Assembly rejected the Joint Committees report and the recommendations made therein. However questions and issues in the report raised with regards to the link between corruption and terrorism still remain.

AfriCOG report: Election Day 2013 and its Aftermath:

In commemoration of this historic election, the Africa Centre for Open Governance (AfriCOG) presents its own findings related to election day and its aftermath in this report. In line with its commitment to promote permanent vigilance by citizens over public life and public institutions, AfriCOG provides an account of voters’experiences at the polling station. In addition, the report details the counting, tallying and results transmission procedures, noting the varied problems associated with these procedures. Overall, in contrast to many observer reports, AfriCOG finds that the failure of electoral technology made it impossible to verify the manual counts of election results. This was compounded by a wide array of problems at the polling station, ranging from names missing from the voters’ register to voter bribery.

To conclude, AfriCOG recommends a series of reforms to ensure that future elections live up to constitutional standards for transparency and verifiability.

And “TransCentury sells Rift Valley Railways stake to Citadel”.  The RVR saga continues, alongside the SGR saga.

Could Rwanda’s Kagame get thrown out of the “smoke filled room”?

The Chairman of the House Foreign Affairs Committee, Rep. Ed Royce (R. Calif.)  has released a letter yesterday “decrying targeted killings of Rwandan regime critics abroad” in which “the Chairman urged Secretary Kerry to reevaluate U.S. engagement with Rwanda, including future assistance”:

Dear Mr. Secretary: I am writing to express my deep concern over the numerous attempted attacks and killings of Rwandan dissidents living outside that country. Any functioning and responsible democracy allows the voices of opposition to be heard. Yet in Rwanda there is a systematic effort to silence – by any means necessary – the voices of those who question the regime in Kigali.   .  .  .  .

This really strikes me as a potentially major setback for Kagame.  In addition to the support Kagame has had from those who were at the helm in the U.S. executive branch 20 years ago during the 1994 genocide and Kagame’s ascension, he has also had an extra level of support in recent years from some House Republicans and others in the Republican Party.  Part of it is the same type of thing that kept Museveni and the Ethiopian regime of Meles Zenawi in favor with some on the “right” in American politics well after most people who pay attention to Africa got over the notion that this class of rulers represented a “renaissance generation” of semi-democratic leadership.  Kagame has lost a lot of his American support over the last few years over the exposure of his actions in relation to the DRC and his growing authoritarianism, even though continuing to solidify his stature as a “go to” source for troops for the U.S. and Europe in the region and a secure landingpad for global investment endeavors. (h/t Cameron Hudson @cch7c on the Royce letter)

Kagame may have finally gone too far to stomach for both the Republican and Democrat mainstream in Washington.

A next question will be what reaction we see from the global elite, what some might refer to as “the Davos crowd”, including the wealthy investor/philanthropist/celebrity networks which have patronized Kagame.  In fact, the World Economic Forum last year was the venue for Kagame to announce with “homeless billionaire” Nicolas Berggruen, Nigerian investor Tony Elumelu and former U.S. official Jendayi Frazer the launch of the “East African Exchange” in Kigali.

As reported at the time in Africa Mining Intelligence, “Kigali, Future minerals trading platform” : “[A] commodities exchange in East Africa that will deal initially with farm goods and minerals covering the entire Great Lakes region, will be set up in Kigali, capital of Rwanda . . . The inauguration of the East African Exchange (EAX) will be seen to by a consortium whose most prominent figure is Jendayi Frazer who was a U.S. assistant secretary of state for African affairs under George W. Bush.”

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