Jaindi Kisero
7 January 2008
Nairobi — Sooner or later, the economic destruction caused by the worsening violence in Kenya, which erupted in the wake of an election whose results have been pronounced flawed by European Union observers - was bound to take on a regional dimension.
As we went to press, the crisis was already threatening to plunge the landlocked economies of neighbouring Uganda, Rwanda, Burundi and the northern and eastern parts of the Democratic Republic of Congo into a spiral of macroeconomic instability spurred by shortages of essential consumer products and crippling inflation.
As of Wednesday last week, at least 100 trucks loaded with petroleum products destined for Uganda and Rwanda were stuck at various Kenya Pipeline Company (KPC) depots in the western Kenya towns of Nakuru, Eldoret and Kisumu - the main flashpoints of the post-election violence that has engulfed the country.
Uganda's oil distribution and marketing channels faced unprecedented paralysis due to the fact that the major oil depots supplying petroleum products to that country are located in two of these three towns.
The Kisumu KPC depot, via the route Kisumu and Busia, moves 60 per cent of all petroleum supplies reaching Uganda, with the Eldoret depot accounting for the remainder.
According to our sources at KPC, 46 oil tankers were stranded at the Kisumu oil depot as of Wednesday last week. Another 26 oil tankers were stranded in Eldoret, while 19 other oil tankers were stuck in the Rift Valley's central town, Nakuru.
As we went to press, the management of KPC, in a desperate attempt to coax oil transporters to resume business, had offered to provide security escorts for oil tankers operating between Kisumu and the Busia border post.
KPC sources told us that the owners of the oil tankers were still reluctant to release their vehicles.
The post-election violence in Kenya is also denying its landlocked neighbours access to Mombasa, the major seaport serving the region and the Great Lakes.
Within the region, Kenya is the economic linchpin. Because of its strategic location, its relatively developed infrastructure, educated working class and large middle class, Kenya has the ability to serve as either the locomotive of development or an agent of destabilisation of the region and farther afield.
In 2006, the country's share of exports to the East African Community accounted for 42.6 per cent of total exports to Africa.
Kenya also dominates the intra-Comesa export market with a 34 per cent market share, followed by Egypt with 17 per cent.
Last year, exports to Uganda amounted to Ksh42 billion ($656 million), 80 per cent of which was accounted for by re-exports of petroleum products. Exports to Rwanda amounted to Ksh7.2 billion ($112.5 million) and to Tanzania Ksh18 billion ($281.25 million). Kenya's potential to either lead regional development or drag the process down is enormous - all the more so because the East African region is characterised by permeable borders with ethnic groups overlapping national boundaries and extensive flows of people and goods - both legal and illegal - between the states.
If Kenya explodes in the current circumstances, it will badly effect the security environment of the region and cripple international peace efforts in the major conflict areas of Somalia, Burundi, Southern Sudan and Congo.
The crisis in Kenya has left Uganda and Rwanda in a quandary: Whether to just sit back and watch even as their economies are ravaged by the impact of post-election violence in Kenya, or deploy security forces in the 120-kilometre stretch between Kisumu and Busia in order to guarantee supply of petroleum products to their countries.
These touchy issues of sovereignty explain why nearly all Western governments were quick to call for mediation between the key protagonists - President Mwai Kibaki and his nemesis Raila Odinga.
Just how much influence the international community can exert to bring Kibaki and Raila Odinga to the negotiating table remains difficult to tell.
In the case of the United States, its interests in Kenya - economic and geostrategic - remain limited in comparison with other parts of the world. US companies do not have a major presence in Kenya's corporate sector, and while the US views Kenya as critical to the security of the East African region and a key ally in the "war on terror," the region itself is not critical to Washington's interests.
Thus, there is little chance the US will intervene strongly to force the protagonists to the negotiating table - unless there is a Rwanda-type disaster.
In contrast, the European Union has major interests in Kenya. European companies have invested heavily in the tourism, agribusiness and financial sectors.
Kenya has played a key role in negotiating Economic Partnership Agreements between the EU and East Africa, while the EU runs a massive programme for Somalia from Kenya.
Hundreds of thousands of EU residents live and work in Kenya, most of them for non-governmental organisations and international humanitarian bodies with headquarters in Nairobi.
Is a political solution likely? All indications are that the current stalemate is likely to drag on, with Kibaki and Raila both claiming the right to rule Kenya.
The two sides will negotiate continuously, but as long as each of the antagonists demands the ouster of the other, there will be little ground for compromise.
Worse still is the fact that no Kenyan group or individual has the popular support and image of objectivity necessary to play the role of arbitrator in the conflict. Even the churches do not have the credibility to play honest brokers.
And, so long as Kenyan politics remains a winner-take-all game where the victors control both power and wealth and the losers have neither, the chances for a deal remain slim indeed.
Just how prepared are the Kenyan security forces to apply muscle to restore peace in the country and to contain a protracted stand-off?
In the middle and the lower ranks of the disciplined forces, the structure left behind by the regime of former president Daniel arap Moi is still in place. These ranks continue to be dominated by the Moi regime's appointees.
The fear is that as the conflict intensifies, and if the stalemate drags for too long, the ethnic polarisation being witnessed in society at large may start taking a toll on the motivation of the disciplined forces to crush the demonstrations.
Retired president Moi created overlapping and competing security forces. Today, these various security forces and the cliques that further sub-divide them counteract each other.
As long as the political stalemate endures and the conflict continues to be interpreted in ethnic terms, getting the disciplined forces to do the dirty work for the politicians may prove to be a major challenge.
In the medium term, if the protagonists do agree to international mediation, the scope will have to be expanded to include reform of the dysfunctional Electoral Commission and minimum constitutional reforms to legitimise a power-sharing deal.
But unless the politics of the country is reformed and not left to be run on the basis of political patronage, a hurriedly crafted power-sharing deal will quite soon prove unsustainable. The primary tool that the big man in Kenya uses to rise to the helm is patronage and fear.
Loyalty is still very lucrative in Kenya. Opposition brings exclusion from opportunities for personal advancement, as the state is still very much viewed as the personal fiefdom of the president.
The president plays the role of puppet master, frequently shuffling officeholders and administrators to allow as many sycophants as possible their time at the trough, while making it clear that he can take power and wealth away as easily as he distributes them.
Clearly, a power-sharing formula that does not address these shortcomings is bound to collapse sooner or later. For President Kibaki, the choice will be between holding constrained political power for five years and holding absolute power in a pariah state with no functioning economy.
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