Myopic 'greens' threaten exports: as Kenya begins to gear up for the December elections, analysts are beginning to take stock of President Mwai Kibaki's record on the economy during his first term of office. The raw statistics, so far, are positive, despite threats to the country's horticulture exports from foreign environmentalists. Report by Neil Ford.

Author:Ford, Neil

President Kibaki has not officially announced his intention to stand again but it seems more than likely that he will seek re-election. After several years of disappointment, economic growth has begun to pick up, providing the ammunition that his new National Rainbow Coalition-Kenya (NARC-Kenya) party needs in the forthcoming electoral battle. Yet global problems that have not been caused by the people of Kenya or their government are threatening to undermine a key pillar of the economy. When Kibaki gained power in December 2002, hopes were high of an economic recovery. The economy had stalled somewhat during the final years of rule by previous president Daniel arap Moi, as Kenya's reputation for corruption began to grow and the government's reform programme came to a virtual full stop.



Yet the early years of the Kibaki government were also tainted by a spate of corruption allegations and political infighting, and it seemed as if the hopes of a nation were going to be dashed yet again.

Despite many delays and concerted domestic opposition, some economic reforms have now been forced through. The role of the private sector has been extended in the rail sector and elsewhere, while foreign direct investment has picked up. The improving picture has been reflected in the steady rise in economic growth: 2.8% in 2003, 4.8% in 2004, 5.7% in 2005 and 6.1% in 2006. Although this rate will have to be maintained for many years if it is to feed through into higher living standards, it is at least a start. Growth has been strongest in the key agriculture sector, plus tourism, manufacturing and construction. Corruption and high crime rates remain major problems, while inflation has risen worryingly, from 10.3% to 14.5% over the past year, although this is largely due to higher food and oil prices.

The threat of 'food miles'

However, efforts to tackle global warming could have a major impact upon growth in the agricultural sector. The UK and the rest of the European Union (EU) member states are the main markets for Kenyan fruit, vegetables and flowers; indeed two-thirds of all Kenyan exports to the EU are agricultural products.

The trade has been attacked by some environmental campaigners because of the 'food miles' involved. Food miles are the distance that any food product must be transported before it is consumed and it must be conceded that Kenyan agricultural products travel a long way before they reach the EU...

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