Only if we had 10 Safaricom like corporations in Kenya
Safaricom as a corporation is gigantic, at least as far as the local market is concerned. By valuation, Safaricom is now one seventh of the country’s GDP, having surpassed the Kshs 1 trillion mark last week. Compare that to our GDP which is slightly over Kshs 7 trillion. When compared by revenue, the government is only 6.4 times bigger than Safaricom as the government collected Shs 1.365 trillion in taxes in 2017 compared to Safaricom’s total revenue of Kshs 212.9 billion over the same period of time. On revenue base, we again find that about seven Safaricom like companies would technically equal the government of Kenya. Too bad the entire country owns only 60% of Safaricom.
The reason I wish we had about 10 Safaricom like corporations is the much good suck like corporations could do to the country. As much as corporations like Safaricom are profit greedy, successful corporations normally end up uplifting the economic profile of the mother countries. We have several examples to cite especially in Europe, the US and Asia.
In South Korea, corporations like LG, Samsung, and Hyundai Motor Company technically control the entire fabric of South Korea’s economy. Samsung for example almost single handedly helped South Korea grow from shackles of poverty the country was immersed in after world war II to become one of the richest countries we have today. Samsung’s contribution to the South Korean economy has become so big that CNN Money writes, “South Koreans can be born in a Samsung-owned medical center, grow up learning to read and write with the help of Samsung tablets and go on to attend the Samsung-affiliated Sungkyunkwan University. It doesn’t end there. They may then live in a Samsung-built apartment complex, fitted out with the company’s appliances and electronics. South Koreans can even end up at a Samsung funeral parlor when they die.”
Back in Kenya, we have Safaricom that shows the signs of being in the trajectory of becoming our own Samsung, even though by market capitalization the two companies are worlds apart. Whereas Safaricom is valued at roughly USD 10 billion, Samsung’s market capitalization is in the upward of USD 250 billion, or 25 times as big as Safaricom. Despite the huge disparities, Safaricom is probably the only company that is showing signs of transforming economy of Kenya in the scales similar to what Samsung did for South Korea.
The transformative agenda Safaricom has established can be seen not only in direct and indirect life changing key products like MPESA, but also in community focused agenda seen in Safaricom Foundation, the support for sports and culture, and the involvement in the education sector.
Safaricom Foundation for example has invested some Kshs 1.8 billion in various projects in education, health, economic empowerment, the environment, arts and culture, music and sports. In education, the foundation helps several underprivileged schools across the country to build classes, furnish laboratories and libraries, and offer scholarships to needy students.
The Safaricom Foundation is not the only foundation being run by the corporate giant. The most successful Safaricom product, MPESA, also has its own foundation, the M-PESA foundation. Alongside investing in diverse projects also ranging from environment to economic empowerment, the M-PESA foundation has also heavily invested in education – best known by the M-PESA Foundation Academy.
M-PESA Foundation Academy is an exemplary project. The academy is set to help nurture talent and provide an environment through which discoverers, inventors and innovators can arise, not just to shine but to be able to have a major impact on the transformation of the country’s economy.
The impacts Safaricom and M-PESA has created over the years are enormous and numerous, and that’s why I am of the opinion that if we had 10 such companies contributing to our growth, the country could have been set to an accelerating pedestal whose destination would be a first world economy. And this is possible.
Over the years, the government has focused in helping individuals and groups of individuals with a few thousand shillings meant to help them start businesses. These individuals (youth, women or people with disability), given their backgrounds and meagre funds they receive, cannot create businesses capable of becoming Safaricom like companies. If however the Government set to identify specific innovations by a few creative youth, then embark on funding these innovation in both product development and marketing, then these innovations could easily translate to big corporations with potential to penetrate markets outside Kenya. It is already too bad that Safaricom is not allowed to venture outside the country.
With 10 Safaricom like companies, we’ll have several first class academies that will easily train innovators, innovators who will easily come up with life changing products, products that can in turn develop to multinational companies, companies that can in turn play the direct role of elevating our economy from shackles of poverty to lands of milk and honey, just as Samsung did to South Korea.
