President William Ruto has repeatedly framed Kenya’s ambition as “going to Singapore,” noting that Kenya stands where Singapore stood years ago. His vision is a bold commitment to steer the nation toward a first-world, high-income economy.
However, as Prof Rigas Doganis, the legendary aviation economist, observed in his book, Flying off Course, a plane that flies just one degree off course ends up thousands of kilometres from its intended destination.
Kenya’s annual Finance Bill ritual is precisely that plane. One small degree of self-interest here, one quiet defection there, and we wake up with a budget that raises revenue on paper but kills jobs, investment and hope on the ground.
This is the deeper context of a national tragedy that unfolds every year with a predictable script: despite private sector associations, chambers of commerce and civil society submitting position papers, the economy continues to drift off course.
This persistent failure to align-a dynamic so dramatically underscored by the withdrawal of the June 2024 Bill amid nationwide protests-forces us to ask a crucial question: Why is our collective failure so utterly predictable?
The answer lies not in incompetence or malice, but in a cold, hard logic first mapped out by mathematicians and economists: Game Theory, and its most famous illustration, the Prisoner’s Dilemma. To understand the current impasse, we must move beyond the rhetoric and examine the structural paradox at the heart of our policymaking.
Imagine two suspects arrested for the same crime and questioned separately. The police offer each a deal: if both cooperate and stay silent, they both serve a minor one-year sentence. However, if one betrays the other (defects) while the partner stays silent (cooperates), the defector goes free while the silent cooperator receives a ten-year sentence. If both betray each other, they each receive a moderate five-year sentence.
From an individual standpoint, betraying the partner is the “rational” choice, regardless of what the other person does, because it offers the best personal outcome-either freedom or a reduced sentence. Yet, when both follow this selfish logic, they both end up worse off, serving five years instead of the single year they would have received through mutual trust.
This paradox perfectly illustrates how the individual pursuit of self-interest leads to a collective disaster that leaves everyone in a weaker position than when they started.
This same dilemma is acutely prevalent among private-sector associations and chambers of commerce. Despite formally agreeing on collective industry position papers, dominant members often subsequently defect to pursue individually negotiated exemptions or to lobby for higher taxes on their competitors.
Glaring use cases emerged during the 2023/2024, 2024/2025 and 2025/2026 Finance Bill cycles, in which the cement, steel, paper, tiles and ceramics sectors were destabilised by asymmetric wins that eroded the manufacturing ecosystem’s overall competitiveness.
This dynamic extends to the relationship between the private and public sectors. While business requires stability and incentives, the government needs revenue for infrastructure and debt servicing. Ideally, both sides would cooperate for shared growth. Instead, each defect, as private players push for loopholes that shrink the tax base, while public officials respond with blunt, revenue-grabbing measures.
This lack of trust, further supercharged by corruption where bribes for secret exemptions destroy the level playing field, ensures that defection becomes the only rational choice, turning small errors into systemic course deviations.
Resolving the Prisoner’s Dilemma necessitates a fundamental strategic shift. Game theory demonstrates that iterative interactions foster reputation; when participants anticipate future engagements, the long-term cost of defection increases significantly.
To rectify our current trajectory, we must implement radical transparency, such as the real-time publication of every submission and amendment to the Finance Bill. Furthermore, institutional integrity and collective accountability are essential. Industry associations must demand ethical consistency from their members, while the government must prioritise sustainable growth over immediate revenue gains.
Ultimately, the primary responsibility rests with the Executive and Parliament; these institutions bear the duty of care to ensure that transparency serves as a disinfectant, sanitising the legislative process for the public good.
As the 2026/27 Finance Bill cycle begins, the question remains whether we will choose cooperation and long-term collective wins over short-term clever defections.
The Prisoner’s Dilemma does not care about our intentions; it only rewards those brave enough to break the cycle. To continue doing the same things we have done for over 60 years while expecting different outcomes is the very definition of insanity.
It is time to stay the course toward our intended destination and ensure our legislative process serves the public good rather than narrow individual pay-offs.