Kenya was selected as a case study for this project on the role of the private sector in humanitarian response because it has a vibrant and innovative private sector, a history of severe and repeated humanitarian crises and a track record of public–private partnerships for humanitarian action.
The study found a wide range of such partnerships and contractual relationships. These include traditional emergency response roles such as transport and food and non-food procurement; financial transfer systems, including through innovative e-money transfers via mobile phones or village banking agents; efforts to keep markets functioning during droughts, including destocking before animals lose their value and paying out on insurance previously bought by pastoralists; and ground-breaking corporate collaboration and fundraising in support of the Kenya Red Cross Society (KRCS).
Opportunities and constraints
- Although humanitarian interventions in Kenya have been dominated by ‘classic’ relief operations (e.g. food aid), there is a move towards more market-sensitive options that will broaden the base of private sector engagement. The most exciting developments, from a humanitarian perspective, are within the rapidly growing sectors of finance and telecommunications. Partnerships have been developed with Kenyan mobile phone companies and banks to facilitate cash transfers: their rapid growth is directly touching crisis-affected populations in Kenya. Many Kenyan mobile operators and banks have business models committed to reaching the poorest, crisis-prone areas of the country.
- During the 2011 drought response, interventions were mostly pilots and represented a relatively small proportion of overall transfers, and insufficient mobile phone coverage and inadequate rural markets continue to slow the spread of these partnerships. There are also questions about how sustainable some of them will be if profits for the private sector – independent of aid contracts – do not follow. Nevertheless, the switch to cash for drought response and the new partnerships forged with banks and telecoms companies represent a radical departure from the food aid-based emergency response practice in Kenya.
- The possibilities for other humanitarian (or humanitarian-related) products, such as crop and livestock insurance, health services and improved market information, have only just begun to be explored. Another area ripe for increased humanitarian–private sector partnership is in the commercialisation of the livestock sector in Kenya’s arid lands, as envisaged in Kenya’s Ending Drought Emergencies Strategy (EDES). At a practical level there are now issues for the government, donors and the private sector to resolve around which initiatives should be taken to scale quickly, the pace of change from food to cash, and the need for donor subsidies to promote new partnerships.
- The private sector has limited confidence in government to deliver in humanitarian crises. It has respect for but no detailed knowledge of how the international humanitarian system works. Kenya has a well-developed set of business associations, which currently engage mostly on humanitarian issues such as political violence that impact them directly. But they could become a valuable channel for widening the private sector engagement in other humanitarian crises. The EDES and the National Disaster Management Authority (NDMA) Strategic Plan envisage engaging the private sector. This will work best if government and donors can articulate a compelling, business-motivating case for reducing humanitarian crises – a case that would explain bottom line benefits from investments in the arid and semi-arid lands (ASAL) and using market mechanisms to respond to droughts. This will be a long-term project but one that recent developments in banking, mobile telephony, transport and mining suggest is a high priority.
- There is a growing awareness of humanitarian issues amongst the Kenyan population and Kenyan firms, which increasingly match donations made by their staff. The Kenya Red Cross Society (KRCS) annual fund raising gala is the place for senior business executives to be seen. This is part of an encouraging trend towards wider corporate social responsibility. Several of the larger firms, such as Safaricom and Equity Bank, have set up their own foundations, though mostly for small-scale, longer-term development work. The government and donors should encourage the public and private media to give out humanitarian information to educate citizens further about roles and responsibilities in humanitarian crises in order to enhance accountability and encourage further giving.
- KRCS is widely accepted as the first responder for small and medium-scale humanitarian crises, and partnered with mobile phone companies and other national and international firms to raise money for both the drought response and in the aftermath of the Westgate mall attack in Nairobi in September 2013. KRCS’ business model includes raising funds from property including hotels, and its ambulance fleet is managed by its private sector arm.
- Looking ahead, if Kenya is to cut dependence on food assistance and reduce and manage its own humanitarian crises, a number of changes are needed, including a more prominent role for the private sector in preparedness and response. Taking greater national responsibility for humanitarian challenges will require a capacity to raise more resources domestically or through borrowing internationally; an improved transport system that allows the private sector to deliver relief items rapidly; more integrated and resilient markets in drought-prone areas; a capacity to transfer cash to crisis-affected people so that they can make use of those markets; a middle class educated on humanitarian issues and willing to contribute and hold their government to account; and a government that plans with the private and NGO sectors, taking advice on international best practice.