CENTRAL BANK OF KENYA
The Technical University of Kenya (TUK)
1st International TUK-SBMS International Conference
Rethinking Economic and Business Sustainability in Disruptive Times
Keynote Address by Dr. Patrick Njoroge
Governor, Central Bank of Kenya
Thursday, November 25, 2021
As Prepared for Delivery
Good morning! I am pleased to join you at the inaugural Technical University of Kenya
(TUK), School of Business and Management Studies International Conference. Let me at
the outset express my gratitude for the invite. The theme of the conference—Rethinking
Economic and Business Sustainaibility in Disruptive Times—is timely, as we reflect on
the challenges and opportunities that the coronavirus (COVID-19) pandemic has brought
to the fore. Importantly, how will governments and businesses build on the lessons from
the pandemic, and thereby enhance their agility to grow and thrive in a dynamic
environment? I note the wide array of papers to be presented over the next two days, that
will enrich the outcomes of the conference.
The pandemic has upended lives and livelihoods while fundamentally changing
enonomies and businesses. In Kenya, a robust response from the government and private
sector has served us well in containing the pandemic and ensuring business continuity.
The economy is now on a steady recovery path, while the financial sector has been
resilient in supporting businesses and households. We must however remain vigilant as
COVID is an enemy that attacks with stealth, with devastating consequences. Tellingly,
we have seen in recent weeks a resurgence of the virus in Europe and parts of the United
States, inspite of their high rates of vaccination against COVID-19.
Coming back to the theme of the conference, what has changed over the last one and a
half years with the pandemic? And how do we rethink economic and business
sustainability in disruptive times? In venturing to answer these questions, I will first
highlight three recent trends in the business landscape.

First, is the dominance of Bigtechs. The pandemic has been characterized by accelerated
digitization that enabled keeping the lights on for essential services including finance,
education and health. Digital payment rails for instance in Kenya, Rwanda, Ghana and
other African countries were a critical platform for official and personal transfers to the
vulnerable segments of our population. More broadly, in the wake of COVID-19
containment measures, global technology platforms (Bigtechs) offering information
technology, e-commerce, entertainment and other services have increased their reach and
influence during the pandemic.
Globally, Microsoft, Google, Meta (formely Facebook), Amazon and Apple are the face
of Bigtechs. But beyond the United States, Alibaba and Tencent in China, Mercado Libre
(online market) in Latin America, ride-hailing services Grub and Gojek in South East
Asia, and mobile phone financial services firms in Africa are increasingly exhibiting the
characteristics of Bigtechs though on a more regional scale.
The global Bigtechs are now estimated at 20 percent of the market capitalization on the
New York Stock Exchange. To paint the picture more vividly, Apple took 42 years to
reach a market capitalization of US$1 trillion and 2 years to hit US$2 trillion.
Shockingly, all of the second trillion in valuation came in just 21 weeks to August 2020!
The Bigtechs have far and away displaced the traditional bluechips companies in
manufacturing and aviation such as General Electric and Boeing in their dominance.
Second, is the proliferation of technology and innovations. From mobile banking to
cloud computing, artificial intelligence to blockchain technology, internet of things, and
robotics. All these developments herald significant opportunities to re-engineer the
operations of governments and business and transform lives and livelihoods. Indeed, we
are at the cusp of the Fourth Industrial Revolution, whose transformative powers are
already evident in the financial sector, and will transform the way we live, work, and
relate to one another. In the words of Professor Klaus Schwab, who popularized this
label: “It is characterized by a fusion of technologies that is blurring the lines between
the physical, digital, and biological spheres.”
Some of these technologies, such as Artificial Intelligence (AI) present significant
opportunities to address some of our most pressing problems on the continent. For
instance, despite Micro, Small and Medium Enterprises (MSMEs) being the engines of
our economies, access to credit remains a key challenge. This in part arises from lack of

traditional collateral such as title deeds used by financial institutions to secure credit
facilities. With the proliferation of digital footprints, AI can be used to generate credit
histories of MSMEs. These credit histories can then be used to appraise and
appropriately price credit for MSMEs that would otherwise be excluded from accessing
credit.
The potential of AI extends to other critical areas including retail, advertising,
manufacturing and health. But these new technologies pose challenges including how the
data they use is collected and the formulation of the decision-making algorithms that
underpins them. Ethical considerations are emerging with the growing use of AI,
particularly whether they can perpetrate existing structural biases such as against women
in access to financial and other services.
Data governance remains a key concern with AI as it extends its reach. For instance, do
MSMEs understand how their data will be used in the algorithms? Are they made aware
by the financial institutions and other service providers of how their data will be used?
And is their consent to use the data for AI and other purposes well informed?
Third, is the growing global wealth inequality. The richest one percent are getting
wealthier, drawing on the trends of Bigtechs and Technology. I mentioned earlier the socalled one percenters are drawing their fortunes from the technology and innovation
arena that is the new normal. Before the pandemic, tech entrepreneurs and investors were
working towards building companies valued at USD1 billion referred to as Unicorns.
The pandemic has seen an acceleration of start up technology companies valued at
USD10 billion, the Decathons. In 2021, 30 start-ups have been valued as Decathons
compared to 15 in 2020, and just 5 in 2019. Most of these Decathons are in the ecommerce, data analytics, AI and other innovations space.
On the other hand, the pandemic has reversed years of steady progress of the global
vision of shared prosperity by 2030. This is espoused in the implementation of the
United Nations Sustainable Development Goals (SDGs). According to World Bank
estimates, over 100 million people will be pushed into extreme poverty by 2030, by the
pandemic, exacerbated by climate change and armed conflict particularly in the Middle
East and Africa. Accordingly, the goal of bringing the global absolute poverty rate to less
than 3 percent by 2030, which was already at risk before the crisis, is now harder than
ever to reach.

Against this backdrop, how do we reimagine the future of our economies and businesses?
I will sketch three broad ideas.
First, people-centricity must be at the heart of technology and innovations. Any
technology and innovation must answer the question of what need it is solving. We are
increasingly attracted by the fanciness of technology and innovation and are blinded to
the problem it is solving. Kenya’s mobile money story has become a global posterchild
of innovation. What is often missed, is the problem of transferring money from urban to
rural areas, that spawned the digital revolution in Kenya. My clarion call to students who
are in the audience and are aspiring to be innovators and entrepreneurs is to keep
people’s needs at the centre of everything that you do.
Second, emerging and developing countries such as Kenya need to be at the global table
on the governance of Bigtechs. Bigtechs are an integral part of our day-to-day lives as we
communicate, transact on e-commerce and conduct other financial transactions. Their
reach has grown during the pandemic and they continue to scale up their services
globally with resultant spill-over effects, particularly in emerging and developing
countries. As the United States, the European Union and China design governance
structures for the Bigtechs, we must not be left behind.
I am pleased to note that the United Nations has incubated the Dialogue on Global
Digital Finance Governance. The Dialogue was established to explore the nexus of
Bigtechs and sustainable development. Its goal is to catalyse governance innovations that
take greater account of the SDG impacts of Bigtechs and are more inclusive of the voices
of developing nations. Kenya co-hosts the Dialogue with Switzerland and will bring on
board insights from developing countries.
Third, is a renewed focus on shared prosperity. The pandemic has wiped out years of
progress on the SDGs, particularly on health and education. Youth, women and MSMEs
have been disproportionately affected by the adverse impact of the pandemic. MSMEs in
developing and emerging countries are the backbone of the economy and support the
lives and livelihoods of a significant swathe of the population. We must therefore get
them back on their feet through increased access to credit and other business support
services (finance plus). In 2018, before the pandemic, the International Finance
Corporation estimated a funding gap of USD331 billion for SMEs in Sub-Saharan

Africa. I expect that with the pandemic, this gap has increased substantially, and banks
and other financial institutions will play a significant role in meeting this gap. More
generally, let achieving shared prosperity for all our citizens be our guiding compass.
Will these three ideas be enough to future-proof businesses and our societies in the
disruptive times? The simple answer is no, as highly efficient systems and processes are
worthless without the people that use them. The multiplicative power of technology
underscores the importance of well-trained staff, aligned to the objectives of society and
the institutions they work for. A single rogue trader or IT employee can bring down a
hundred-year institution. Each of us has to be the best that we can be, renewing ourselves
relentlessly. Quoting Alvin Toffler, “The illiterate of the 21st century will not be those
who cannot read and write, but those who cannot learn, unlearn and relearn.” We have
to be nimble, quick to adapt to the rapidly changing world, and fully aware that with
great powers comes great responsibility.
In closing, I wish to draw your attention to the large mural across the street from your
campus, of Kenya’s Marathon Champion Eliud Kipchoge with his mantra No Human is
Limited., He inspires me along with millions of his fans to raise my standards. As he
says, “To win is not important. To be successful is not even important. How to plan and
prepare is crucial. When you plan very well and prepare very well, then success can
come on the way.” I hope the mural will remind you how to approach your time at this
university, and encourage you in your successes and failures as No Human is Limited.
I look forward to the outcomes of the deliberations over the next two days as we
reimagine the future of our economies and businesses in disruptive times.
Thank You!