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Government and Politics:

Kenya is officially a multiparty state. The system of government consists of the president, who holds executive power, and a single legislative assembly consisting of 210 members, the attorney general, the speaker, and 12 members who are nominated by the major parties in parliament in proportion to the number of seats won. Mwai Kibaki is currently the president of Kenya.

Economy

The cornerstone of Kenya’s capitalistic economy is agriculture. It employs over 80% of the population, contributes 50% of the country’s export earnings, but only contributes 25% of the GDP. Principle food crops are maize, sorghum, cassava, beans and fruit, while the main cash crops are coffee, tea, cotton, sisal and tobacco. Subsistence farmers on small plots of land mainly grow food crops, while cash crops are grown on large privately owned plantations employing contracted laborers. All were hit hard during droughts in 1997 to 2000.

Coffee and tea are the largest export earners, with large markets in Asia and the Middle East. Both have suffered recently due to the global fall in prices and drought. International quotas imposed to benefit European and American interest, exacerbate the situation by limiting Kenya’s ability to dispose of its stockpiles.

Kenya’s industrial base which is concentrated around Nairobi and Mombasa, accounts for some 13% of the GDP, however a poor infrastructure (including power, water and roads), high taxation, and rampant corruption have strangled profits. The principle products include processed food, beer, vehicles and their accessories, construction material (including concrete), engineering, textiles, glass and chemicals. If the controversial Tiomin Resources Inc. mine near Kwale (southwest of Mombasa) goes ahead, titanium could soon join the list.

A uniquely African economic sector is the “jua kali” industry (literally translated as “under the fierce sun”). Open air and covered workshops proliferate across Kenya producing pots, ironware, weaving, furniture, crafts and basketry.

Tourism was once the highest export earner. With the events of September 11 in the US, the bombing of the US embassy in Nairobi in 1998 and riots in Mombasa in 2001 tourists have been reluctant to travel to Kenya on holiday. Still over 500,000 people have visited annually, contributing $350 million to the economy. 

Kenya’s external debt of around $6.2 billion (in 2000) is still considered to be low by African standards, but a huge proportion of the country’s foreign-exchange earnings go into servicing foreign debt. Aid to Kenya from the IMF was suspended in 1997after Kenya failed to meet anticorruption requirements and again in 2001 after a brief resumption. As the Kenyan budget relies on receiving about $300 million a year in foreign aid, President Kibaki primary challenge will be to get international donors back on his side.

With the resumption of the Comesa free trade agreement with Tanzania and Uganda, East Africa has become the biggest market for Kenyan exports, overtaking the EU.

Inflation is currently running at under5%. GDP per capita is $360 and Kenya is the 17th poorest country in the world. Kenya also has the third largest gap between rich and poor, with a staggering 42% of the population subsisting on KSh60 per day.