Kisumu like any other locality has numerous shortcomings which hinter its economic performance. There are extreme disparities in wealth distribution and the gap between the poor and the rich continues to widen day after day. Among Kisumu’s challenges we have the following:
Kisumu has the highest poverty levels in Kenya when compared with other parts of Kenya. This has affected the ability of the locals to engage in meaningful business ventures. This is symbolized by emergence of informal settlements as most people can’t bear up with the high cost of living. Kisumu is not a major agricultural center and most of basic food stuffs come from other counties.
Unemployment rate is very in Kisumu and many people have been affected by this situation. The youths are the most affected and are fleeing the city in hope of getting greener pastures somewhere else. Others have resorted into vices such as stealing and robbery to earn a living. The county government of Kisumu is taking affirmative steps to solve this problem. These steps include wooing investors to invest in the region and establishment of various industries in the region .This will in return create employment to a large number of people and thus improve the living standards of the residents.
For some time now, Kisumu has been rocked by political violence which occurs mainly during elections .The post election violence which was witnessed in December 2007 affected Kisumu significantly with houses being burned down and property being destroyed. People perceived to be associated with other parties apart from ODM which was the dominant party in Kisumu by then were alienated, tortured and even others killed. This was a major blow to the young economy of Kisumu which was still growing. Most Investors pulled from this region in fear of losing their investments.Currently Kisumu is slowly recovering from this political wave and has started showing positive improvement on economic growth.
Kisumu is currently facing competition for investors with other cities and towns within the country .Such cities include Eldoret, Nakuru, Kakamega and Kisii. The county government of Kisumu should list down its comparative advantages over other cities and take up the responsibility of ensuring Kisumu remains at the top hence able to attract investors into the region. Failure to do this will eventually lead to investors withdrawing from the region causing loss of jobs.
This is another challenge which hampers economic development in Kisumu. Local leaders in most cases have poor judgment and lack planning skills which results into negative results. Poor planning is very evident in housing estates which have lead to development of many informal settlements .Drainage and sewerage systems are poorly fixed which may cause decease outbreaks such as cholera. Local leaders should take planning seriously and avoid approving projects which don’t meet the minimum requirements if they want to see Kisumu entering into the next phase of economic development as a cosmopolitan city.
In conclusion the county government of Kisumu should firstly take some measures to reduce these negative influences. It can use tax leverage as a means to help young people engage in small businesses thus creating self employment. This will boost economic development and also raise the standards of living.