Professional Documents
Culture Documents
NS4301
17 AUG 2015 1
Outline
• Country Background
• Economic History
• Economic Data
• Social/Governance Data
• Vision 2030
• Assessment
• Recommendations
2
Country Background
• Official Name: Republic of Kenya
• Population: 45,925,301 (0-14 years: 41.56% 15-24 years: 18.66%)
• Ethnic Groups: Kikuyu 22%, Luhya 14%, Luo 13%, Kalenjin 12%, Kamba 11%, Kisii
6%, Meru 6%, other African 15%, non-African (Asian, European, and Arab) 1%
• Languages: English (official), Kiswahili (official), numerous indigenous languages
• Religions: Christian 82.5% (Protestant 47.4%, Catholic 23.3%, other 11.8%), Muslim
11.1%, Traditionalists 1.6%, other 1.7%, none 2.4%, unspecified 0.7% (2009 census)
• Government: Executive(President, Cabinet), Legislative (Bicameral Parliament),
Judicial
• Location: Eastern Africa, bordering the Indian Ocean, Ethiopia 867 km, Somalia 684
km, South Sudan 317 km, Tanzania 775 km, Uganda 814 km
• Climate: varies from tropical along coast to arid in interior.
• Terrain: low plains rise to central highlands bisected by Great Rift Valley; fertile
plateau in west.
• Natural Hazards: recurring drought; flooding during rainy seasons 3
Political Economic History I
• 600 – 1830’s: Early Arab trade settlements on coastal area.
• 1895: Formation of British East African Protectorate.
• 1920: Crown colony of Kenya established - administered by a British governor.
• 1944: Kenyan African Union (KAU) formed to campaign for African independence w/ Jomo Kenyatta
as leader.
• 1952 – 1956: Mau Mau uprising. British official death toll - Kenyans: 11,000 – Kenyan Human Rights
commission death toll: 90,000. Up to 160,000 detained for years in camps.
• 1963: Independence - Jomo Kenyatta as prime minister.
• 1964: Republic of Kenya formed. Kenyatta becomes president. Odinga as vice-president /early rapid
economic growth through public investment, encouragement of smallholder agricultural
production, and incentives for private (often foreign) industrial investment.
• 1963 to 1973: Gross domestic product (GDP) grew at an annual average of 6.6% w/agricultural
production growth at 4.7% annually.
• 1969: Political unrest - Assassination of government minister Tom Mboya sparks ethnic unrest. KPU
banned and Odinga arrested.
• 1974: Daniel arap Moi succeeds Kenyatta as president, stays in office until 2002
• 1980s and 1990s: Economic potential far below potential
• 1982: Kenya officially declared a one-party state by National Assembly.
• 1987: Opposition groups suppressed. International criticism of political arrests and human rights
abuses. 4
Political Economic History II
• 1991: Forum for the Restoration of Democracy (Ford) formed by six opposition leaders, including Odinga. Party
outlawed and members arrested resulting in creditors suspending aid to Kenya amid fierce international
condemnation / Ruling party KANU agrees to introduce a multi-party political system / Approximately
2,000 people killed in tribal conflict in the west of the country / Multi-party elections. Moi and Kanu win
strong majority.
• 1991 to 1993: Kenya has its worst economic performance since independence / Growth in GDP stagnates and
agricultural production shrank at an annual rate of 3.9% / Inflation reaches a record 100% in August 1993.
• mid-1990s: Government implements economic reform measures to stabilize the economy and restore sustainable
growth lifting nearly all administrative controls on producer and retail prices, imports, foreign exchange,
and grain marketing / The economy grew by an annual average of only 1.5% between 1997 and 2002,
which was below the population growth estimated at 2.5% per annum, leading to a decline in per capita
incomes / The poor economic performance was largely due to inappropriate agricultural, land, and
industrial policies compounded by poor international terms of trade and governance weaknesses /
Increased government intrusion into the private sector and import substitution policies made the
manufacturing sector uncompetitive.
• 1997: Demonstrations call for democratic reform. World Bank withholds disbursement of $5bn in structural
adjustment credit / Governance issues result in International Monetary Fund (IMF) and World Bank
suspending support in 1997 / Moi wins again in widely-criticized elections.
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• 1998: Al-Qaeda operatives bomb the US embassy in Nairobi killing 224 people and injuring thousands.
Political Economic History III
• 1999: Moi appoints opposition leader Richard Leakey to head government drive against corruption.
• 2001: Leakey appears in court to face charges of abuse of power and perverting the course of justice /
International Monetary Fund (IMF) and World Bank suspend support again due to governance issues /
Ethnic tensions and riots in Nairobi's Kibera slum district.
• 2002 Al-Qaeda terror attack on Israeli-owned hotel near Mombasa kills 10 Kenyans and injures three Israelis. A
simultaneous rocket attack on an Israeli airliner fails / Elections. Kibaki wins a landslide victory, ending Daniel
arap Moi's 24-year rule and Kanu's four decades in power.
• 2003-2007 Government begins ambitious economic reform program and resumes cooperation with the World Bank
and the IMF. There was some movement to reduce corruption in 2003, but the government did not sustain the
momentum. Economic growth began to recover with real GDP growth registering 2.8% in 2003, 4.3% in 2004,
5.8% in 2005, 6.1% in 2006, and 7.0% in 2007 / Government bill proposes anti-corruption commission -
International Monetary Fund (IMF) resumes lending after three-year gap, citing anti-corruption measures / Moi
granted immunity from prosecution on corruption charges.
• 2005 Corruption takes center stage when it is claimed that graft has cost Kenya $1bn under Kibaki /
Parliament approves a draft constitution after days of violent protests in Nairobi over aspects of the draft
which demonstrators say leaves too much power to in the president's hands.
6
Political Economic History IV
• 2005: Voters reject a proposed new constitution in what is seen as a protest against President Kibaki. The president
replaces his cabinet; some nominees reject their appointments.
• 2006: Beginning of year - drought in North leaves four million people needing food aid / President Kibaki unveils the
2030 development plan / High level government corruption scandals / China begins prospecting for oil off
Kenyan coast / End of year - Regional flooding renders thousands homeless. Some 100,000 Somali refugees
cut off by floodwaters in the north-east are supplied by air drops.
• 2007: Common Market for Eastern and Southern Africa (COMESA) summit endorses move to adopt a COMESA
customs union / Ethnic based violence after disputed presidential election - 1,500 die.
• 2008: Violence and unrest results in significant downward economic effects which are compounded by the drought
and the global financial crisis - growth down to less than 2% / The government and opposition come to a
power-sharing agreement / Parastatals Kenya Electricity Generating Company (KenGen), Telkom Kenya, and
Kenya Re-Insurance are privatized. 25% of Safaricom sold, reducing government share to 35%.
• 2009: At least 10 million people, or one third of the population are in need of food aid / The IMF Board approves a
disbursement of approximately $200 million under its Exogenous Shock Facility (ESF), which is designed to
provide policy support and financial assistance to low-income countries facing exogenous but temporary
shocks / The government says it will co-operate with the International Criminal Court (ICC) to try key
suspects in post-election violence.
7
Political Economic History V
• 2010: The EAC Common Market Protocol allows for the free movement of goods and services across the five
member states / Remittances are $640 million; however, the actual number may be as high as $1 billion / US
suspends $7m of funding for free primary schools in Kenya until fraud allegations are investigated / Kenya
joins its neighbors in forming a new East African Common Market, intended to integrate the region's
economy / New constitution designed to limit the powers of the president and devolve power to the regions
approved by referendum.
• 2010: Tea is Kenya’s top export, accounting for $1.15 billion. Fresh horticulture exports are $718 million, well short
of the record high of $1.12 billion in 2007, in part due to unfavorable global weather conditions that affected
air transportation. Tourism rebounded from the drop experienced in 2008 after the post-election violence,
bringing in $807 million in 2009, an increase of 19% from 2008.
• 2010: the Kenyan Ministry of Tourism recorded nearly 1.1 million tourists–an all-time high–and an 18% revenue
growth in local currency terms. Africa is Kenya’s largest export market, followed by the European Union (EU).
Kenya benefits significantly from the African Growth and Opportunity Act (AGOA), but the apparel industry is
struggling to hold its ground against Asian competition. Approximately 90% of Kenya’s AGOA exports in 2010
were garments, and Kenya’s garment exports under AGOA totaled $202 million in 2010 (a slight increase
over 2009 but still well below the 2006 level of $265 million).
• 2011: The IMF approved a 3-year, $508.7-million arrangement for Kenya under the Fund’s Extended Credit Facility /
East Africa hit by worst drought in 60 years / Al Shabab raid Kenyan coastal resorts and a refugee camp,
targeting foreigners / Kenyan troops enter Somalia to attack Al-Shabab who are accused of the kidnappings
of foreigners on Kenyan soil.
• 2012: International Criminal Court rules that several prominent Kenyan politicians must stand trial over the 2007
post-election violence / Oil discovered / Launch of Lamu port project which is to become South Sudan's oil
export outlet / More than 30 injured in al-Shabab attack on a Nairobi shopping center / More than 100
people are killed in communal clashes over land and resources - Coast Province / Troops rampage in the
town of Garissa, near the Somali border, after gunmen shoot dead three Kenyan soldiers serving in the 8
African Union mission in Somalia.
Political Economic History VI
• 2013: Uhuru Kenyatta, the son of Kenya's first president, wins presidential election with just
over 50% of the vote. A challenge to the results by his main rival, Prime Minister Raila
Odinga, is rejected by the Supreme Court / International Criminal Court (ICC) drops
charges against Francis Muthaura, a co-accused of Mr Kenyatta, over the 2007
election violence / Deputy President William Ruto pleads not guilty at the
International Criminal Court to crimes against humanity charges over the 2007 post-
election violence / al-Shabab militants seize the Westgate shopping mall in Nairobi
and kill more than 67 people, saying they want Kenya's military to pull out of Somalia.
• 2014: Several countries issue travel warnings following several attacks by al-Shabab /48
people die after Islamist militants attack hotels and a police station in Mpeketoni,
near the island resort of Lamu / Kenya revises the way it calculates growth, making
the economy 25% bigger than previously thought – and the fourth biggest in sub-
Saharan Africa / Prosecutors at the International Criminal Court drop charges against
President Kenyatta over the 2007 post-election violence, citing insufficient evidence
• 2015: Al-Shabab militants carry out a massacre at Garissa University College in northwest
Kenya, killing 148 people / Four Kenyans and a Tanzanian charged with terrorism
offences over the Al-Shabab Garissa attack / Barack Obama praises Kenya's progress
as he make his first visit to his father's homeland.
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Economic Headlines
• Challenges:
– High degree of ethnic diversity with varying access to land resources
– Corruption
– High reliance on external flows
– Economy is vulnerable to weather conditions
– Large informal sector
Source: Rabobank; DKinKY; CIA World Factbook 10
Econ Data: GDP I
11
Econ Data: GDP II
12
Econ Data: GDP III
13
Econ Data: GDP IV
GDP Compared in Region
Source: UNDP; 18
Social/Governance Data I
United States
South Africa
Kenya
Nigeria
Tanzania & Uganda
Ethiopia
Niger
Source: UNDP; 19
Social/Governance Data II
Source: WEF; 21
Social/Governance Data IV
Source: Transparency.org; 22
Social/Governance Data V
Non-Renewable
Diversity
Among 3 Nations with
Advantages necessary for
long-term growth without
being penalized for
short-term fall in raw
materials prices.
27
Kenya Vision 2030
The Vision: Economic Social Political
“To Create a Globally
Competitive and Prosperous
Nation with a High Quality of
life by 2030”
Constitutional &
Projects: Tourism Education & Legal Reforms
Flagship projects form the Agriculture Training Leadership,
foundation of Medium-Term Trade Health Ethics, &
5 year plans. Environment Integrity
• Road, infrastructure, and
Manufacturing
ICT Population National
irrigation construction.
Financial Gender Cohesion &
• Building and deepening
capital markets. services Culture Integration
• ICT infrastructure and Oil and Gas Legal Aid &
backbone. Awareness
• Policy reforms: land Criminal Justice
reform, human rights, System
judicial system, etc. Judicial
Transformation
“DEPLOYING WORLD CLASS INFRASTRUCTURE FACILITIES & SERVICES
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The economic, social and political pillars of Kenya Vision 2030 are anchored on
macroeconomic stability; continuity in governance reforms, enhanced equity and wealth
creation opportunities for the poor.”
Assessment I
2 Five-year Medium Term Plans (MTP).
On paper, Vision 2030 address trouble areas from
the Global Competitiveness Index.
1st MTP (2008-2012):
Promote national reconciliation
Projects to repair damaged property
Assistance to Small Scale Business
IDP relocation
New constitution, increased school
enrollment
Increased road, internet, and power
generation capacity.
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Source: 2014 Rabobank Country Report.
Wait…..I’ve got the answer…
• Kenya is making many of the right decisions, but some fundamental,
deep-rooted social, economic, and political issues have been holding it
back since independence.
• Good choices regarding manufacturing, agriculture, and governance are
necessary to achieve the rapid economic growth of Vision 2030
– Increase participation in the economy
• Rural: Build greater agricultural infrastructure; connect more of the 75% of population
working in agriculture to the formal economy; provide wider ethnic access to land
resources and political process
• Urban: Formalize the informal economy; grow manufacturing jobs to provide employment
for growing youth demographic
– Increase productivity in (non-food) manufacturing sector
– Decrease corruption
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Questions?
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