NAIROBI — Kenya is currently wading through uncharted territory. In September, its Supreme Court nullified the results of its Aug. 8 presidential election.
In the first contest, the nation’s current president, Uhuru Kenyatta, allegedly defeated veteran opposition leader Raila Odinga by 1.4 million votes. But Odinga claimed the vote had been manipulated. In an unprecedented move for Africa, the court acknowledged the election was flawed and called for a repeat election in 60 days.
The new elections are scheduled for Oct. 26, but Odinga has said he will not participate, citing doubts about the fairness of the new process, though his name may still appear on the ballot.
In recent weeks, political disagreements and growing insecurity have put Kenyans on edge. Mobs attacked electoral commission centers, and human rights groups say as many as 50 people have been killed by police. A last-minute Supreme Court hearing to rule on delaying the vote was canceled because too few judges showed up. In the current environment, even the chairman of the electoral commission has said it’s unclear if the country can have a credible election.
What is clear, experts say, is that the political crisis is having a profound effect on Kenya’s economy.
Kenya’s August elections were already among the most expensive in Africa, according to Quartz, and the new contest will only further add to taxpayer’s bills. The government spent $480 million to run the August elections, up from $260 million spent in the elections of 2013. The October elections, which won’t require a repeat of parliamentary, governor or local elections, will cost an extra $100 million.
For a country with an annual budget of $26 billion, that’s not an insignificant chunk of change.
“The government has had to divert money from key infrastructural developments like roads in order to finance the elections,” says Patrick Mbataru, a public policy expert with Nairobi’s Kenyatta University. “This is certainly going to affect production going forward and the effects can already be felt.”
Among some in the business community, reaction to the redo election was immediate.
The Supreme Court’s Sept. 1 ruling led to a brief suspension of trading at the Nairobi Securities Exchange after blue-chip stocks plummeted. The NSE 20 Share Index, which covers Kenya’s largest and most heavily traded companies, declined by more than 5 percent, though it has since rebounded.
Days later, the Kenya Private Sector Alliance asked that “the elections be carried out without undue delays or extensions, as prolonged political seasons are costly to the Kenyan economy.”
But some reports suggest damage has already been done.
According to a survey by Stanbic Bank released in October, the health of the Kenyan private sector is deteriorating due to the political climate. Employment and purchasing activity declined in the Kenyan private sector for the second month in a row in September.
Ronald Ngeno, a businessman based in Nairobi, says that the election drama has had a negative effect on his rental car business.
“People are not hiring cars to go on trips; they are not traveling anymore,” he says. “I have had to increase premiums in order to insure them against post-election violence and yet business is low. I am hurting. I just want the elections to end.”
This year’s presidential contest takes cue from the controversial 2007 presidential election, which sparked months of bloodshed and also affected the economy, with the tourist sector particularly hard hit. The Kenya Tourism Board recorded losses of about $80 million per month for the first quarter of 2008.
In 2016, tourism accounted for almost 10 percent of gross domestic product, according to the Kenya National Bureau of Statistics. And a report released last week by the Kenya Private Sector Alliance suggested the industry may be affected by political uncertainty, though not as significantly as one might assume. In the second quarter of 2017, the accommodations and food sector’s growth rate was 13.4 percent, down from 15.8 percent the year before, the report found.
Despite the figures, the Kenya Tourism Federation insists the turmoil hasn’t stopped large numbers of holiday takers from visiting the country’s beaches and safari lodges — at least yet.
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Kenya’s Repeat Election Comes With a Heavy Price Tag originally appeared on usnews.com
