Why the world is watching Kenya

Top presidential contenders in Tuesday’s election Raila Odinga (L) and William Ruto

By Business Daily Africa

Kenyans go to the polls Tuesday morning to choose a new President in a hotly contested General Election that is expected to test East Africa’s largest economy.

Kenya’s capital Nairobi has long been the region’s business hub rivalling African cities such as Johannesburg, Cape Town, Cairo and Lagos and businesses and entities domiciled in the country are hoping for a smooth transition.

Nairobi, a regional aviation hub, boasts a skilled English-speaking labour force and rivals top cities in the world in information technology infrastructure that has persuaded multinationals like Google, Microsoft, Visa, and Amazon to set up regional hubs in the city.

The influx has helped shore up Kenya’s position as East Africa’s wealthiest economy and a regional gateway.

Kenya’s role as a Western ally in a region roiled by conflict has also made it a favoured headquarters for multinational firms operating in East Africa.

Opinion polls have predicted a tight race between opposition leader Raila Odinga and outgoing Deputy President William Ruto to succeed President Uhuru Kenyatta, who will leave office at the end of the constitutional two terms that started in 2013.

Mr Kenyatta is backing Mr Odinga to succeed him and has lately embarked on an aggressive campaign for the veteran opposition leader against his deputy.

While there has not been major election-related violence in the current campaigns and the risk is seen as significantly low, the ghosts of the 2007/8 violence continue to haunt importers in the neighbouring countries and transporters in the Northern Corridor as well as the global community.

A recent Central Bank of Kenya (CBK) survey found the chief executives see today’s election as well as the stability of the Kenyan shilling as some of the biggest impediments to the growth and expansion of firms in the remainder of this year.

Kenya’s economy has a history of slowing down during election years when firms put investment decisions on hold, pending a return to normality. Economic growth slowed down to 4.81 percent in 2017 as a result of the bitterly contested presidential poll from 5.88 percent a year earlier. The deadly 2007 presidential poll sank the economy to a growth of 0.23 percent from 6.8 percent the year before.

Businesses and traders in some cities and towns, including Nairobi, were on Tuesday protectively moving away valuable goods from their shops even as police were preparing for a possibility of violence, according to a Business Daily spot-check. On Tuesday, the shilling declined to a new low of 119.12 against the dollar, according to the CBK.

Amid elevated jitters, calls mounted from global agencies and the diplomatic community for Kenya to hold peaceful elections and a presidential transition.

A total of 14 diplomatic missions led by the United States last week underscored the need for Kenya to ensure a peaceful transition, citing its strategic importance in the region.

“Kenya is an anchor for stability, security, and democracy – not just in the region, or on this continent, but across the globe,” the diplomats from the embassies and high commissions of Australia, Canada, The Czech Republic, Denmark, Finland, Germany, Ireland, Italy, The Netherlands, Norway, Sweden, Switzerland, UK, and USA said in a joint statement.

“This election is of huge significance. We call on all leaders – both in and out of elected offices – to work together after August 9 to ensure the democratic progress of the last decade is preserved.”

Kenya has also in recent weeks emerged as a player in brokering peace in conflicts in Ethiopia, South Sudan and the Democratic Republic of Congo. The nation is normally seen as an oasis of peace in a volatile region. This is why a smooth transition is seen as crucial by the global community.

A recent report by the heads of US intelligence agencies — who include Avril Haines (director of national intelligence), CIA chief William Burns, General Paul Nakasone (head of the National Security Agency) and FBI director Christopher Wray — says the US is concerned that Kenya’s pivotal role as a regional peace broker could be compromised by domestic distractions related to this year’s election.

“East Africa probably will see new bouts of conflict in the coming year as the region becomes increasingly strained by the civil war in Ethiopia, power struggles within the transitional government in Sudan, continued instability in Somalia, and a potentially contentious election in Kenya,” it says.

A team drawn from the African Union-COMESA Election Observation Mission, the Commonwealth Observer Group, the IGAD Election Observation Mission and private sector bodies has also called for a peaceful transition.

“We call on the leadership of all political parties and their supporters, as well as civil society, faith-based organisations, and all other stakeholders, to ensure a continuation of the calm and peaceful atmosphere during the remaining phases of the electoral process,” said the Heads of the international election observation and expert missions in Kenya in a joint pre-election statement.

Kenya’s FDI attraction had been helped by its status as the region’s financial centre, and a hub for many multinationals doing business in the region.

Nairobi is also home to the United Nations Environment Programme (Unep), multinational companies and diplomatic missions.

The United Nations Office at Nairobi, the UN headquarters in Africa, was established by the General Assembly in 1996. The United Nations has its Africa headquarters in Nairobi, with more than 3,000 workers.

Besides the African Union, some of the top global companies and Non-Governmental Organizations (NGOs) operating in Addis include Diageo, Save the Children International, Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), SAP, Google, Microsoft, McKinsey & Company, UNDP, UNICEF, Procter & Gamble among others.

Others are Hilton, Hyatt, Oxfam, Marriott International, and the World Bank among others.

Nairobi, Kenya’s capital, was ranked top in Africa and 12th globally in the Expat City Ranking 2021 by InterNations, the world’s largest expatriate community.

Expatriates rank the city’s social life headlined by a vibrant nightlife and ease of finding affordable housing highly.