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BBI: Increased county funds good for regional economic blocs – KBC | Kenya’s Watching

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Devolution is a primary issue in the Building Bridges Initiative (BBI) most notably, increasing funding for counties from the current 15% to 35% and, ensuring greater inclusivity, fairness, equity and accountability in the distribution of resources. 

Besides increasing the fiscal allocation to counties, there is need to entrench cooperation and integration among the devolved units so as to achieve optimal utilization of resources within their purview.

The law requires counties sharing close geographical proximity, economic, commercial, industrial and other ties, to jointly facilitate development, management and use of cross-boundary economic resources and infrastructure.

The constitutional basis for such mutual pursuit of economic interests by the devolved units is to be found in Articles 6(2), to the effect that county governments shall conduct their mutual relations on the basis of consultation and cooperation, and Article 182(2), empowering the devolved units to set up joint authorities to actualize such cooperation.

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In addition, various legislative instruments give legal effect to such cooperation, like Section 3 of the Intergovernmental Relations Act mandating cooperation and consultation among county governments, and Section 182 of the Public Finance Management Act, on creation of county corporations.

Since becoming operational in 2013, counties have formed regional blocs to advance their economic and development agenda. These are North Rift Economic Bloc (NOREB), Central Kenya Region Economic Bloc (CEREB), Lake Region Economic Bloc (LREB), Jumuiya ya Kaunti za Pwani (JKP), South Eastern Kenya Economic Bloc (SEKEB) and Frontier Counties Development Council (FCDC)

However, a comprehensive legal and policy framework for the establishment and management of county economic blocs has been lacking. Issues like the modalities of cooperation and the functions of the regional entities are left to county assemblies to ratify via legislation.

This underscores the need for a national policy and legal framework on the establishment and management of county regional economic blocs, as per a Presidential Directive issued in October 2018, followed by the formation of a Technical Working Group for the National Policy Framework for Regional Economic Blocs.

This process should be fast-tracked as part of the ongoing BBI discussions on strengthening devolution. The County Resource Development Bill 2020, now before the Senate, also needs expediting since it not only entrenches county economic integration but could be the anchor for transformation of existing county blocs into even bigger entities.

This entails regional blocs in close geographical proximity merging so as to more effectively leverage comparative advantages and develop requisite infrastructure to harness common resources.

A perfect example would be a merger between CEREB and SEKEB that would bring together 13 counties stretching from Makueni in the east to Nakuru in the west. These two blocs have so much in common and being contiguous to each other, could potentially evolve into a huge trade and investment corridor spanning agriculture, livestock, tourism, mining, transport and energy.

Interestingly, BBI proposes the restructuring or winding up of parastatals carrying out county functions. These presumably include regional development authorities like Tana and Athi River Development Authority, Kerio Valley Development Authority, Coast Development Authority and others.

No doubt these agencies have played an important role in rural development but as relics of the centric model, they may need restructuring so as to plug well in a devolved system. As such, we should align such development institutions which fall under the State Department of Regional Development in the Ministry of East Africa Community and Regional Development , firstly by transferring the state department to the Ministry of Devolution  and secondly  involving  county governments in the management of those regional bodies including  prioritising development  through the regional economic blocs.

Such bigger formations  and alignment if well managed would provide economies of scale for efficient utilization of increased funding to counties as envisaged in BBI but more importantly, catalyze equitable development in areas considered historically marginalized.

Larger county economic zones will also attract increased foreign direct investments and funding from development partners. This will however depend on transformed political thinking premised on a long-term vision of socio-economic prosperity for the people. A robust dispute resolution mechanism is also critical to success.

Mr. Choto is a lawyer and policy analyst. kingorichoto@gmail.com

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