Kenya: Current Conditions and the Challenges Ahead

Kenya: Current Conditions and the Challenges Ahead

Order Code RS22524
Updated November 28, 2007
Kenya: Current Conditions and
the Challenges Ahead
Ted Dagne
Specialist in African Affairs
Foreign Affairs, Defense, and Trade Division
Monty Rushmoore McGee
Research Fellow
Foreign Affairs, Defense, and Trade Division
Summary
Kenya, a nation of about 36.9 million people, has been an important ally of the
United States for decades. Kenya moved from a one-party state to a multi-party
democracy in 1992. Kenyans voted in record numbers in the country’s first multi-party
election in almost 26 years. President Daniel arap Moi defeated opposition candidates
by a small margin. In 1997, Kenya held its second multi-party elections, at the height
of tensions between the opposition and the ruling party. President Moi was re-elected
with 40% of the votes cast, while his nearest rival, Mwai Kibaki, won 31%. In the 2002
presidential and parliamentary elections, the opposition National Rainbow Coalition
(NARC) defeated the ruling Kenya African National Union (KANU). In the presidential
election, NARC leader Kibaki defeated Uhuru Kenyatta, the leader of KANU. A number
of major political figures have emerged to challenge President Kibaki in the election
scheduled for December 27, 2007, although several of these candidates have dropped
out of the race. The two major candidates challenging President Kibaki are Raila
Odinga and Stephen Kalonzo Musyoka. In October 2007, President Kibaki dissolved
parliament. A survey conducted in late October 2007, gave Odinga 50%, while Kibaki
was second with 39%. A late November survey closed the gap between Odinga and
Kibaki, with Odinga 45% and Kibaki 41%. This report will be updated as
circumstances warrant.
Background
Kenya, a nation of about 36.9 million people, became independent in December
1963 after a prolonged and bloody uprising against Britain, with over 13,000 casualties.
Kenya resisted the Marxist-Leninist ideological tide that swept much of Africa in the
1960s and 1970s and maintained a fairly stable political system in a region marred by civil

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strife and political violence. Although it was governed under one-party rule until 1992,
Kenya had a relatively open political system. Kenya’s first president was Jomo Kenyatta,
an independence advocate from Kenya’s largest ethnic group, the Kikuyu. Kenyatta’s
successor as president was Vice President Daniel arap Moi, who took over as president
upon Kenyatta’s death in 1978. Moi, a teacher before entering politics, is a Kalenjin –
traditionally a pastoral people based in the western portion of the Kenya highlands. Many
non-Kikuyu initially hoped that his presidency would redistribute the benefits that they
felt had unfairly accrued to the Kikuyu under Kenyatta. In 1991, President Moi
reluctantly and under pressure agreed to move to multi-party politics, eight years after his
government had amended the constitution to legalize one-party rule. The move to a
multi-party state came after two years of an anti-government political campaign by
opposition groups and persistent pressure by donor governments, including the United
States.
In 1992, Kenyans voted in record numbers in the country's first multi-party election
in almost 26 years. President Moi defeated opposition candidates by a small margin. His
party, the Kenya African National Union (KANU), also won a majority in the 210-seat
parliament, despite the defeat of several senior KANU officials by little-known opposition
candidates. The three major opposition parties, the Forum for Restoration of Democracy-
Kenya (FORD-Kenya), FORD-Asili, and the Democratic Party (DP), each received
substantial votes, but fell short of expectations. In 1997, Kenya held its second multi-
party elections, at the height of tensions between the opposition and the ruling party.
President Moi was re-elected with 40% of the votes cast, while his nearest rival, Mwai
Kibaki, won 31%. The ruling party, KANU, won 107 seats in the 222-member parliament
(12 seats out of the 222 are appointed by the president), while the opposition secured the
remaining 103 seats. International and Kenyan election observers said that while there
were some irregularities, the results of the elections reflected the wishes of most Kenyans.
The victory by Moi was largely due to divisions within the opposition and the inability
of the opposition to back a single candidate against Moi.
The opposition learned from its mistakes, and in 2002 it succeeded in forming and
holding together a coalition, known as NARC (National Rainbow Coalition), that ousted
KANU from power by wide margins. NARC won 132 seats in parliament, compared with
KANU’s 67, while Kibaki defeated Uhuru Kenyatta, son of Jomo Kenyatta, for the
presidency with a 62% majority. Moi had designated Kenyatta as the KANU candidate
for president in October 2002, prompting Raila Odinga, who had sought the nomination,
to leave KANU and, with other defectors, form the Liberal Democratic Party. Kibaki’s
National Alliance of Kenya (NAK) courted these KANU defectors, and in November
2002, NAK and the LDP agreed to create NARC. NAK is itself a coalition, including
Kibaki’s Democratic Party and 12 other parties which typically have an ethnic or regional
base. President Kibaki announced his cabinet on January 3, 2003, consisting of longtime
opposition figures and also senior members of KANU. President Kibaki had to take
several factors into consideration in the selection of his cabinet members, including ethnic
balance, technical skills, and government experience, as well as rewarding old and new
political allies.

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The Challenges Ahead
The 24-year rule of President
Moi kept Kenya united, but left the
Kenya At A Glance
East African country in serious
Population: 36.9 million
economic and political trouble. The
Comparative Area: Slightly more than twice the size of
most immediate political challenge
Nevada
to President Kibaki is to strengthen
Ethnic Divisions: Kikuyu 22%, Luhya 14%, Luo 13%,
his political base since a number of
Kalenjin 12%, Kamba 11%, Kisii 6%, Meru 6%,
other African 15%, Asian, European, and Arab 1%
key leaders from his coalition have
Religions: Protestant 45%, Roman Catholic 33%,
left the party. In the past several
indigenous beliefs 10%, Muslim 10%, other 2%
months, two ministers left the
Languages: English (official), Swahili (official),
g o v e r nm ent a n d e n d o r s e d
numerous indigenous languages.
opposition candidates. However,
GDP (purchasing power parity) $41.36 billion (est.
2006)
President Kibaki has also received
GDP Per Capita (purchasing power parity): $1,200
the support of former President Moi
(est. 2006)
and the former ruling party, KANU.
President Kibaki faces serious
Source: The CIA World Factbook 2007
challenge from presidential
candidate Raila Odinga, who in
recent polls was ahead of Kibaki. A survey conducted in late October by the Steadman
Group gave Odinga 50%, Kibaki 39%, and Kalonzo 8%. A November survey by the
same group gave Odinga 45% and Kibaki 41%. President Kibaki’s new coalition, the
Party for National Unity (PNU), in late October, met to come up with a strategy for the
upcoming elections and to resolve outstanding issues within the coalition. Some of
Kibaki’s key allies have expressed concerns that the opposition might win the elections,
arguing that the team that brought Kibaki to power is divided.
Another challenge is the economy, which was stagnant in the 1990s, but has shown
solid growth in recent years. The GDP grew by an estimated 5.4% in 2006. According
to a November 2007 Economic Intelligence Unit report, “real GDP is estimated to
increase to 6.3% in 2007, a fourth consecutive year of solid performance, owing to broad-
based expansion. In 2008, the rate of expansion will slow to 5.6% as capacity constraints
are increasingly exposed, especially in infrastructure, because of delays in starting or
finishing vital projects.” The IMF sent a mission in January 2006 to review progress.
In April 2007, the IMF resumed lending to Kenya, after a second review of the Poverty
Reduction and Growth Facility (PRGF). The IMF also agreed to extend the PRGF until
November 2007. The World Bank also began assistance to Kenya, with an estimated
$800 million assistance package for projects through June 2008. Meanwhile, inflation
rates reached an average 14.5% in 2006, in part due to 12 to20 percent pay-raises for civil
servants and teachers. In 2007, inflation rates are estimated at 9.4%. Unemployment is
high and corruption is still a serious problem, although the Kibaki government has taken
a number of measures to deal with this problem.
Tackling corruption is seen as a major priority of the Kibaki government, despite the
potential political and social backlash that might result from reform measures. Rooting
out official corruption may require removing senior members of the government from
power and prosecution of former senior government officials. Several ministers were
forced to resign in 2006, and the Kibaki administration continues to face serious
allegations of corruption. The resignation of the Finance Minister in February 2006 for

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alleged corruption was seen by some as an important step in fighting official corruption
in Kenya. However, the clearing of the Energy Minister from corruption charges has
raised serious doubt about the government’s resolve to fight corruption. In early 2005,
the government’s anti-corruption chief resigned from his position, arguing that the Kibaki
government is not serious about fighting corruption and accusing a number of senior
officials of corruption.1 The United States, Britain, and other donor governments have
also made similar accusations.2 In October 2006, Attorney General Amos Wako declared
that he will not prosecute suspects in the corruption case against Anglo-Leasing, a British
firm. According to Wako, successful prosecution will not be possible because of “a
number of material and significant gaps.”
Constitutional reform had been the rallying cry for opposition groups prior to the
2002 elections. As part of a pre-election agreement reached among the key players within
NARC, a proposed new constitution would create a position of prime minister with
executive powers. Reportedly, leaders from the main opposition groups agreed that this
position would go to Raila Odinga, one of the major political figures within NARC. The
constitutional drafting process was marred by delays, changes, and serious disagreement
within NARC. President Kibaki and his supporters managed to get a draft approved in
a process seen by some senior members of NARC as undemocratic. These members
campaigned against the draft constitution, arguing that the agreement reached earlier was
violated, and in November 2005, Kenyans defeated the draft constitution in a national
referendum.3 In late 2005, a number of senior officials left NARC and formed the Orange
Democratic Party (ODM).The defeat of the 2005 draft constitution signaled that President
Kibaki had lost the support of many Kenyans who once gave strong support to NARC.
President Kibaki’s credibility was further shaken in February 2006 by the resignation of
three ministers on corruption allegations. Following these events, some observers
asserted that President Kibaki would struggle to complete his term. However, the
formation of a new party, NARC-Kenya, appears to have altered the Kenyan political
landscape. NARC-Kenya, formally launched in June 2006, replaced NARC, and
demonstrated its political strength by winning three of the five parliamentary seats in the
July 24 by-elections. In September 2007, President Kibaki announced the formation of
a new coalition, the Party of National Unity. The PNU includes KANU, NARC-Kenya,
FORD-Kenya, FORD-People, and the Democratic Party.
Despite the enormous challenges facing Kenya, the Kibaki victory in 2002 had a
positive impact in Kenya as well as in Africa generally. The smooth transfer of power
and the transparency in the conduct of the elections indicated that democracy can flourish
in Africa. For example, the power of incumbency and the entrenched clout of a ruling
party did not stop an opposition victory in Kenya. The lessons learned from the Kenyan
elections are many and could strengthen democracy movements elsewhere in Africa.
Kenya is also a key player in regional affairs, having hosted negotiations on Sudan and
Somalia. Kenya is home to many refugees from Uganda, Sudan, and Somalia. In recent
1 “An Exile Sees Graft as a Piece of Kenya’s Social Puzzle.” The New York Times, March 18,
2006.
2 “Corruption haunts Kenya’s leader.” BBC News Online, February 2005.
3 The author interviewed opposition leaders and government officials in Kenya in 2005 and
2006.

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months, Kenya has come under criticism from the United Nations and human rights
groups for barring additional Somali refugees. The government of Kenya handed over
more than 40 Somalis to the Transitional Federal Government of Somalia (TFG) and the
Ethiopian government. Human rights groups are concerned that some of these individuals
would be tortured or killed. In addition, Kenyan Muslim leaders accuse the Kibaki
government of handing over Kenyan Muslims to Ethiopian and Somali security services.
A number of factors could complicate the December 2007 elections. In recent
months, relations between the government and opposition groups have worsened. In
February 2007, five ministers in the Kibaki government accused two opposition
presidential candidates, Odinga and Ruto, of being criminals. In January 2007, President
Kibaki appointed nine commissioners to the Electoral Commission of Kenya (ECK).
Opposition groups accused the government of appointing political allies to the
Commission without proper consultation with opposition groups. Meanwhile, the
government also announced the creation of 37 new districts, raising the number of
districts from 71 to 108. The Chairman of the ECK criticized the move, arguing that the
Commission was not consulted by the government. If the situation in Somalia continues
to deteriorate, it could have a serious impact on Kenya.
U.S.-Kenya Relations: Issues. Kenya has been a valuable U.S. ally since
independence, providing the United States with access to its military facilities and
political support in the United Nations. Washington once considered Kenya a model
developing country with shared democratic values in a continent where civil wars raged
and military and authoritarian governments reigned. In the early 1990s, relations between
Kenya and the United States became strained due to deteriorating human rights conditions
and the government's resistance to a multi-party system, though relations improved
slightly after the 1992 multi-party elections. Relations have improved significantly in the
past several years; however, the United States remains concerned about corruption and
human rights conditions. The most recent edition of the State Department Country
Reports on Human Rights Practices, issued in March 2007, stated that “The government
in many areas respected the human rights of its citizens or attempted to institute reforms
to address deficiencies. However, serious problems remained, particularly with regard
to abuses by the police.”
Kenya has been an important ally in the war against terrorism, especially since the
U.S. embassy bombings in Kenya and Tanzania in 1998. As many as 5,000 people were
injured in the Nairobi blast, and 86 people in Dar es Salaam. Kenya became a target
again, when on November 28, 2002, near simultaneous terrorist attacks struck targets in
Mombasa, Kenya. Suicide bombers drove a truck packed with explosives into the Israeli-
owned Paradise Hotel in Mombasa, killing 10 Kenyans and three Israelis. Minutes earlier,
terrorists fired two shoulder-fired missiles that missed an Israeli passenger plane taking
off from the Mombasa airport. The State Department’s 2006 Country Report on
Terrorism stated that “Important Kenyan officials spoke out publicly about the dangers
of terrorism and key elements of the Kenyan security apparatus took concrete steps to
increase counterterrorism efforts, including the formation of an interagency Coastal
Security Steering Committee. At the same time, however, political and bureaucratic
resistance remained to the formation of an interagency Kenyan Joint Terrorism Task
Force (JTTF).”

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U.S. Assistance
Kenya has been one of the major recipients of U.S. foreign assistance in Sub-Saharan
Africa for decades, and is an important trading partner with the United States. Despite
Kenya’s years of poor economic performance and serious corruption problems, the United
States maintained a robust development assistance program focused on good governance,
economic development, education, health care, and rural area development efforts in
income generation and the effective use of natural resources. In regard to the promotion
of good governance, the U.S. Agency for International Development (USAID) “continues
to promote transparent and accountable governance by improving the balance of power
among the various branches of government.”4 U.S. support for health care is largely
focused on the fight against HIV/AIDS. Kenya is one of the major focus countries of the
President’s Emergency Plan for AIDS Relief (PEPFAR) and a major recipient of the
Global HIV/AIDS Initiative funding. Security co-operation and support is another area
in which Kenya and the United States work closely. In October 2006, the Bush
Administration removed restrictions on IMET funding for Kenya. The restrictions were
imposed because of Kenya’s refusal to sign an agreement with the United States to
provide immunity to U.S. personnel from prosecution by the International Criminal Court
(ICC).
Kenya: U.S. Assistance ($ in thousands)
Account
FY2005
FY2006
FY2007 Request
FY2008 Request
Actual
Estimate
CSH
14,600
17,840
14,611
16,950
DA
15,782
21,615
21,002
28,300
ESF
7,678
6,420
6,755
FMF
25
800
GHAI
116,495
175,950
285,000
481,000
IMET
139
45
550
NADR-ATA
3,484
3,168
2,938
NADR-CTF
700
100
600
NADR-EXBS
75
100
500
NADR-TIP
285
300
P.L. 480 Title II
45,056
85,700
12,500
Peace Corps
3,150
3,264
3,190
Source: Department of State. CSH: Child Survival and Health; DA: Development Assistance; ESF:
Economic Support Fund; FMF: Foreign Military Financing; GHAI: Global Aids Initiative; IMET:
International Military Education and Training; NADR-TIP: Nonproliferation, Anti-Terrorism, Demining,
and Related programs; NADR-CTF: Counter Terrorism Financing; NADR-ATA: Anti-Terrorism
Assistance; NADR-EXBS:Export Control and Related Border Security Assistance; P.L. 480: food
assistance.
4 USAID’s Strategy in Kenya. [http://www.usaid.gov].