Kenya: Economy Reels From the Effects of Violence

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The East African Standard (Nairobi)

3 January 2008
Posted to the web 2 January 2008

Susan Anyangu And Brian Adero
Nairobi

The stalemate over the election results has cost the economy billions of shillings with the repercussions being felt across East Africa, the business community has said.

Mr Manu Chandaria, the former chairman of the Kenya Private Sector Alliance (Kepsa), said on Wednesday the Government had lost close to Sh4 billion in revenue over the violence that has led to the closure of businesses.

The pinch on the economy is not only being felt locally but has spilt to Uganda, Rwanda and Burundi.

"The cost of fuel per litre in Uganda has gone up from one to four US dollars. Raw materials that were headed for Uganda and Rwanda are stuck at the port of Mombasa. The violence in Kenya is slowly chocking the economies of Uganda and Rwanda and soon this could affect Burundi as well," Mr Arun Devani, chairman of East Africa Business Council said.

The business community is now appealing to the main political protagonists to establish the truth regarding the disputed elections to end the violence.

"The results announced by the Electoral Commission of Kenya have caused a lot of tension and violence in the country because they are not considered credible and the process appears compromised," Mr Patrick Obath the chairman of Federation of Kenya Employers said.

In a statement, Obath said the business community had proposed the setting up of an independent process to establish the truth and provide a basis for negotiations between the political leaders.

Kepsa has appealed to the Government to provide sufficient security for the business sector to resume full operations.

"We are urging the Government to provide security for operations and for the workers to travel safely to places of work, to get goods to the market and to get our transport services working," Obath said. Elsewhere, the Kenya National Chamber of Commerce and Industry (KNCCI) said the business community had incurred huge loses in the aftermath of the General Election.

The KNCCI chairman, Mr Kiprono Kittony, said the business community had incurred losses running into billions of shillings and appealed to the Government to seek dialogue with the disgruntled groups for the sake of the economy.

"Most businesses closed for Christmas with a hope of re-opening after the New Year's celebrations. However, people who had travelled up-country are unable to return to the city due to lack of transport. For more than a week nobody has resumed business," Kittony said.

He urged the Government to restore peace and order immediately.

"The bad picture being relayed on international media is scaring away investors. Tourists who are in the country are making arrangements to leave for fear of being attacked," he said.

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