“You Can’t Tax Your Way Out of Poverty” The Future of Neocolonialism Echoed Within the Kenyan Finance Bill

Lucy Kebirungi

Over the past month, protesters have taken to the streets of Nairobi against the now-withdrawn 2024 Finance Bill. This bill sought to tax essential goods and services heavily to pay off the country’s debt accumulated from foreign lenders such as the World Bank and the International Monetary Fund (IMF). While the bill has now been withdrawn, it is still imperative to reflect on how this cycle of borrowing and taxation leaves nations in strenuous loops that create a dependence on Western powers. 

At its core, neocolonialism relies on the allure of conditional loans and economic dominance to sway the domestic policy within a country under the guise of assistance. This is the direction the IMF and numerous Western powers have taken towards Africa; more evidently through Kenya in recent events. 

Kenya currently owes the IMF a $3.5 billion debt on top of borrowing $941 million in January despite little to no transparency surrounding the expenditure of the loans. The predatory nature of the IMF, paired with corrupt African governments, spells trouble for citizens as living costs skyrocket to accommodate the debt repayment. This leads to severe measures exacerbating poverty and foreign corporations' exploitation of natural resources. 

While residents endure profound hardship, governments unhesitantly auction off fragments of their nations to the highest bidder in a desperate attempt to manage their everlasting debt. The revenue produced within their countries does little to uplift their economy, as it is funnelled back into the pockets of foreign powers; further perpetuating the cycle of external dependency and internal impoverishment. 

Because of this, Western nations and corporations knowingly engage with African nations despite their unstable governments and inability to repay debt, viewing this dependency as advantageous. This strategic reliance enables the continued presence in these countries, enabling the exploitation of their natural resources. Such practices then push one to question whether colonialism ever indeed ended or simply evolved into a new form, perpetuating a cycle of economic stagnation akin to neocolonialism under the guise of international cooperation and diplomacy. 

The situation in Kenya highlights a grassroots concern where individuals appointed into power by the public have no issue furthering this exploitation as long as they receive a piece from it. Ultimately, neocolonial governments are to blame for such practices as much as Western nations and institutions are. The future of neocolonialism depends on whether these

complicit local leaders prioritise their gain over national welfare and if the international community persists in enabling these parasitic dynamics. 

Addressing this concern requires a multifaceted approach targeting corrupt governments and international complicity. Reforming governance structures to ensure greater accountability and transparency is crucial- as is fostering a political culture that prioritises the public good over individual enrichment. 

At the same time, pressure must be placed on international financial institutions while implementing trade agreements that address these imbalances. Grassroots movements play a pivotal role in this transformation by holding leaders accountable, as seen through the rejection of the proposed Finance Bill. Only by addressing internal and external factors can the cycle of neocolonialism be broken, paving the way for genuine self-determination and prosperity in African nations.