Monday, April 1, 2013

KENYAN POLITICS AND ITS IMPACT ON THE ECONOMIES OF EASTERN AFRICA

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By Jerry Okungu
Nairobi, Kenya
April 1, 2013

It is a given that Kenya houses the third largest United Nations complex outside the United States and Europe. It is also true that for decades now, Kenya has been the landing pad for many operations, military, humanitarian and rescue missions in the Horn of Africa and the larger Great Lakes Region. The United Nations agencies have often used Kenya as a friendly nation to support military and humanitarian operations in Somalia, South Sudan, and Ethiopia and to some extent Uganda during the civil war in the early 1970s.

The port of Mombasa to the West Coast of Kenya has been the lifeline of many countries in East Africa and the Great Lakes Region. Beneficiaries of this gateway to the Indian Ocean have included Uganda, Burundi, Rwanda, the DRC, and Northern Tanzania and at one time served Zambia before Tazara Railway line was built to connect Zambia to the port of Dar es Salaam.

This unique position that Kenya commands in East Africa is the reason its general elections become the business of every organization and government with interest in the development of the region. The international community has invested heavily in the country and continues to do so in the hope that all will be well. If Kenya falls apart, many things can go wrong. Many organizations, governments, humanitarian agencies and individuals will suffer irreparable damage. Thousands of refugees housed in Kenya will find themselves exposed to all sorts of dangers they had run away from in the first place.

Here in Kenya, we have a new constitution which will be three years old this coming August. The elections we have just gone through were the first to be held under the new dispensation. And Kenyans had very high hopes that it would go well and catapult the country to new levels of economic development.
For this reason, Kenyan voters thoroughly scrutinized the campaign manifestos that the major parties such as the Orange Democratic Party and the National Alliance party offered them.
It was gratifying to see that the main political parties focused on infrastructure, Regional Trade, Regional Integration and freedom of movement of people, goods and services and peace within the EAC.

Right now, President Kibaki is in office on borrowed time. He will vacate the office as soon as a new president is confirmed by the Supreme Court of Kenya since the presidential election results have been challenged. If the Supreme Court nullifies the results, Kenyans will go back to the polls in 60 days with another possible rerun if none of the candidates garners more than 50% of the votes cast. If this happens, Kenya may not get a new president for the next four or five months if one factors in three weeks following completion of elections before a new president is sworn in.

Kibaki’s departure will have a direct impact on the region’s economic development. With President Museveni they have toyed with the idea of having a more efficient railway line running from Mombasa through Malaba and Busia to Kampala with a possible extension to Kigali and Bujumbura in the foreseeable future. It remains to be seen whether the new regime will pursue such ventures with vigor and whether the new president will find chemistry with Yoweri Museveni.

It may also be remembered that just months before Meles Zenawi of Ethiopia passed away, the three leaders of the region, Salva Kiir of South Sudan, Zenawi and Kibaki performed a groundbreaking ceremony in Lamu to launch a multibillion dollar infrastructure project that would connect South Sudan, Kenya and Ethiopia and facilitate the export of South Sudan oil through the new Lamu Port. The road, rail and oil pipeline would open up trade and human traffic between the peoples of Eastern Africa.

Again this massive project will very much depend on the new Ethiopian Prime Minister, whether he, Salva Kiir and the new Kenyan president will appreciate the need for this project. Or will the ongoing talks between Salva Kiir and Omar El Bashir stall the project should South Sudan choose to deal with the old foe?

As Kenya puts its house in order, it may be necessary for other member states of the East African Community to play their part and move some common projects forward.
One such project is the Lake Victoria Basin Commission which was launched in 2006 with its headquarters in Kisumu. This is the greatest natural asset that belongs to all the member states of the East African Community. The lake needs to be restored to its former glory by carrying out massive environmental clean up, remove the hyacinth that has become a menace choking fish and denying the region’s fishing community their time honored livelihood.

The lake has an idle dry dock at the Port of Kisumu and used to be the conveyor belt for goods and passengers ferried from  Mombasa and Dar es Salaam to Northern Tanzania’s Mwanza, Musoma and Uganda’s Entebbe and Jinja during the  days of the East African Railways and Harbours under the then East African Common Services.

With stable governments in the Great Lakes region, water transport around the lake should be revived to reactivate trade among the states sharing the waters of Lake Victoria. Investments in tourism ventures including luxury yatches should freely ply the ports in Kisumu, Entebbe, Mwanza and Jinja. If transport across the lake is revived, pressure on our roads will be greatly reduced as bulk commercial products including oil can be transported across the lake to Northern Tanzania, Uganda, Burundi, Rwanda and DRC.

Much as Kenya is the biggest and strongest economy in the region, it is not lost on observers that most of its manufactured products are consumed in East Africa. Member states are its biggest trade partners. Therefore what happens in the rest of East Africa and the Great Lakes Region will impact heavily on Kenya. Kenya needs political, economic and social stability in the rest of the region as much as the region expects the same from Kenya. Any war breaking out in Burundi, Rwanda and Uganda as has happened in the past will be a sure recipe for chaos in Kenya with trucks jamming its roads from Mombasa to Malaba.

The influx of refugees will further strain the gains we have achieved in the last five years following the disruption of business activities following the 2008 post election violence.

Since Somalia and the two Sudans are finally stabilizing, East Africa is looking forward to incorporating the three countries into the East African Community if for nothing but to make their stability sustainable.
These are Kenya’s immediate neighbors in the East with Ethiopia also eying the EAC. If they can be persuaded to join the EAC Common Market, the market will be big enough for the countries in the region to do business with one another.

Right now all countries in the region depend on oil from the Middle East to run their economies.  All this oil is imported through the port of Mombasa and the bulk of it must be moved by road, rail or pipeline to the hinterland for destinations as far as Kigali, Bujumbura, Kigoma and Kampala. Therefore any disruption of this traffic for whatever reason has a direct impact on the lives of ordinary millions of citizens of East Africa. When pumps start running dry, transport stalls and industries come to a standstill. This was the experience East Africa went through when Kenya went through a rough patch in 2008.

Right now there is a glimmer of hope that a number of East African countries will start producing oil. At least news to that effect has been in the public domain for some time now. Oil wells have been discovered in some parts of Tanzania, Uganda and Kenya. When these wells become operational and with oil from Southern Sudan landing in Lamu, chances of having cheaper oil and more cash to modernize our infrastructure will be a real possibility.

One other critical infrastructure that drives modern economies is the fibre optic cable. Currently most of East Africa’s connections to the rest of the world in terms of modern communications are through the port of Mombasa. In today’s world, one hour of down time in terms of power or fibre disruption incurs losses in billions of dollars because most of transactions including money transfer have become electronic.

This scenario above calls for faster movement towards regional integration so that there is recognized authority to look after the security and well being of the citizens of the region. With one government, one army, a common currency, a common passport and a common identity card, East Africans will feel safer and more secure in their own region than they feel now. Indeed it does not make sense for me to require a passport to cross the border to Uganda, Burundi or Tanzania. As a civilized community, let us exchange labour, expertise and skills without fear or suspicion. That way, we will develop and move forward.

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