Does Kenya have too many people?
This is an article I’ve been waiting to write for a year. We completed our population enumeration exercise a year ago, and watched the results being delayed many times due to, we are told, “data complexity.” Make of that what you will. I know you are more interested in the numbers your tribe clocked, but I want to ask a more basic question: does Kenya have too many people?
At 38.6 million people, our population is four times what it was when I was born. The average Kenyan woman still bears nearly 5 children. A million new Kenyans arrive every year. So, is that too many?
Many will tell you that it is. They will point to our appalling urban slums, our diminishing food security, our congested urban areas, our rapidly vanishing wildlife, our burgeoning youth unemployment, and conclude: too many people. Many parents are devastated by the rigours of raising, housing, educating too-large families on a shoestring. But there is another side to population growth.
It seems rather obvious, but often isn’t: every new person arrives not just with a mouth, but (usually) a working pair of arms and legs, a full set of senses, and a functioning brain. In other words, every child arrives ready to give as well as to receive. And quite importantly, this child could, if certain things happen, fuel demand in the economy someday as well as add to the supply of goods or services.
Indeed, we could be poised to benefit from a “demographic dividend”, just like India has been of late. What is the source of India’s very impressive global competitive advantage these days? Why, its people. Those very people who were considered its biggest burden, a millstone around the country’s neck, whose numbers led to a forced sterilisation programme in the 1970s – they are now the engine driving India forward. As excellent thinkers like Harvard’s David Bloom and India’s Nandan Nilekani have pointed out: throughout history great periods of economic expansion have coincided with large numbers of young people, and fewer dependants.
What is needed for a demographic dividend to kick in is for an abrupt, preferably natural, fall in the fertility rate of a population. This means that as a large number of young people come of age and start being economically active, they themselves have fewer children – and therefore fewer dependants. That gives an economy a window of opportunity: a time when it has a lot of young, motivated, enterprising people, with a smaller dependency burden to carry. That window can spark the kind of rapid growth that leads to economic takeoff. And the demographics are self-sustaining: a more affluent society always finds its fertility rate trending towards two or three children per woman.
How did India change its greatest burden to its greatest advantage? By ensuring that the brains are fed more than the mouths, so that people are transformed into “human capital”. The new arrivals need to systematically be given education and marketable skills to make them productive and consumptive. India used healthcare progress and rising literacy to trigger a fall in its mortality rate, which in turn (after a lag) led to a fall in the fertility rate.
What does a country with a young, unencumbered population look like? For one thing, it has fewer dependency costs, and saves more. India’s savings rate is trending towards a remarkable 40 per cent. This creates an important pool of indigenous investment capital. For another, it allows for large investments in infrastructure and education. India now has the second largest pool of skilled labour in the world. Lastly, it creates very valuable internal demand for goods and services – India’s consumptive middle class exceeds the entire population of the US.
Not yet convinced? To create a demographic dividend will admittedly be far from easy. Suspend disbelief and catch me here next week.