Kenya (06/07)

For the most current version of this Note, see Background Notes A-Z.

PROFILE

OFFICIAL NAME:
Republic of Kenya

Geography
Area: 582,646 sq. km. (224,960 sq mi.); slightly smaller than Texas.
Cities: Capital--Nairobi (pop. 2.9 million; 2007 est.). Other cities--Mombasa (828,500; 2006 est.), Kisumu (322,000; 1999), Nakuru (219,366; 1999), Eldoret (193,830; 1999).
Terrain: Kenya rises from a low coastal plain on the Indian Ocean in a series of mountain ridges and plateaus which stand above 3,000 meters (9,000 ft.) in the center of the country. The Rift Valley bisects the country above Nairobi, opening up to a broad arid plain in the north. Highlands cover the south before descending to the shores of Lake Victoria in the west.
Climate: Tropical in south, west, and central regions; arid and semi-arid in the north and the northeast.

People
Nationality: Noun and adjective--Kenyan(s).
Population (June 2007 est.): 36.9 million.
Major ethnic groups: Kikuyu 22%, Luyia 14%, Luo 14%, Kalenjin 11%, Kamba 11%, Kisii 6%, Meru 5%.
Religions: Christian 80%, Muslim 10%, traditional African religions 9%, Hindu/Sikh/Baha'i/Jewish 1%.
Languages: English (official), Swahili, over 40 other languages from the Bantu, Nilotic, and Cushitic linguistic groups.
Education: First 8 years of primary school are provided free by the government. Attendance--92% for primary grades. Adult literacy rate--85.1%.
Health: Infant mortality rate--57.4/1,000. Life expectancy--55.3 yrs (2007 est.).
Work force (1.95 million wage earners): public sector 30%; private sector 70%. Informal sector workers--6.4 million. Services--45%; industry and commerce--35%; agriculture--20%.

Government
Type: Republic.
Independence: December 12, 1963.
Constitution: 1963.
Branches: Executive--president (chief of state, head of government, commander in chief of armed forces). Legislative--unicameral National Assembly (parliament). Judicial--Court of Appeal, High Court, various lower and special courts, includes Kadhi (Sharia) courts.
Administrative subdivisions: 69 districts, joined to form 7 rural provinces. Nairobi area has special provincial status. The government has gazetted 37 more districts, whose ratification was still in process as of February 2007.
Political parties: Over 100 registered political parties. The ruling party, the National Rainbow Coalition (NARC), made up of 14 separately registered parties, broke up in 2003, although it is still a registered party. A Government of National Unity composed of Members of Parliament from all political parties was created in 2005. KANU and Liberal Democratic Party (LDP) united to reject a draft constitution in a national referendum in November 2005 and later formed the Orange Democratic Movement-Kenya (ODM-K) party in opposition to the government.
Suffrage: Universal at 18.

Economy
GDP (2006 est.): $22.79 billion.
Annual growth rate (2006): 6.1%.
Gross national income per capita (2006): $455.
Natural resources: Wildlife, land.
Agriculture: Products--tea, coffee, sugarcane, horticultural products, corn, wheat, rice, sisal, pineapples, pyrethrum, dairy products, meat and meat products, hides, skins. Arable land--5%.
Industry: Types--petroleum products, grain and sugar milling, cement, beer, soft drinks, textiles, vehicle assembly, paper and light manufacturing.
Trade (2006): Exports--$3.1 billion: tea, coffee, horticultural products, petroleum products, cement, pyrethrum, soda ash, sisal, hides and skins, fluorspar. Major markets--Uganda, Tanzania, United Kingdom, Germany, Netherlands, Ethiopia, Rwanda, Egypt, South Africa, United States. Imports--$7.2 billion: machinery, vehicles, crude petroleum, iron and steel, resins and plastic materials, refined petroleum products, pharmaceuticals, paper and paper products, fertilizers, wheat. Major suppliers--U.K., Japan, South Africa, Germany, United Arab Emirates, Italy, India, France, United States, Saudi Arabia.

PEOPLE
Kenya has a very diverse population that includes three of Africa's major sociolinguistic groups: Bantu (67%), Nilotic (30%), and Cushitic (3%). Kenyans are deeply religious. About 80% of Kenyans are Christian, 10% Muslim, and 10% follow traditional African religions or other faiths. Most city residents retain links with their rural, extended families and leave the city periodically to help work on the family farm. About 75% of the work force is engaged in agriculture, mainly as subsistence farmers. The national motto of Kenya is Harambee, meaning "pull together." In that spirit, volunteers in hundreds of communities build schools, clinics, and other facilities each year and collect funds to send students abroad. The six state universities enroll about 45,000 students, representing some 25% of the Kenyan students who qualify for admission. There are six private universities.

HISTORY
Fossils found in East Africa suggest that protohumans roamed the area more than 20 million years ago. Recent finds near Kenya's Lake Turkana indicate that hominids lived in the area 2.6 million years ago.

Cushitic-speaking people from what is now Sudan and Ethiopia moved into the area that is now Kenya beginning around 2000 BC. Arab traders began frequenting the Kenya coast around the first century AD. Kenya's proximity to the Arabian Peninsula invited colonization, and Arab and Persian settlements sprouted along the coast by the eighth century. During the first millennium AD, Nilotic and Bantu peoples moved into the region, and the latter now comprise two thirds of Kenya's population. The Swahili language, a Bantu language with significant Arabic vocabulary, developed as a trade language for the region.

Arab dominance on the coast was interrupted for about 150 years following the arrival of the Portuguese in 1498. British exploration of East Africa in the mid-1800s eventually led to the establishment of Britain's East African Protectorate in 1895. The Protectorate promoted settlement of the fertile central highlands by Europeans, dispossessing the Kikuyu and others of their land. Some fertile and well watered parts of the Rift Valley inhabited by the Maasai and the western highlands inhabited by the Kalenjin were also handed over to European settlers. For other Kenyan communities, the British presence was slight, especially in the arid northern half of the country. The settlers were allowed a voice in government even before Kenya was officially made a British colony in 1920, but Africans were prohibited from direct political participation until 1944 when a few appointed (but not elected) African representatives were permitted to sit in the legislature.

From 1952 to 1959, Kenya was under a state of emergency arising from the "Mau Mau" insurgency against British colonial rule in general and its land policies in particular. This rebellion took place almost exclusively in the highlands of central Kenya among the Kikuyu people. Tens of thousands of Kikuyu died in the fighting or in the detention camps and restricted villages. British losses were about 650. During this period, African participation in the political process increased rapidly.

The first direct elections for Africans to the Legislative Council took place in 1957. Kenya became independent on December 12, 1963, and the next year joined the Commonwealth. Jomo Kenyatta, an ethnic Kikuyu and head of the Kenya African National Union (KANU), became Kenya's first President. The minority party, Kenya African Democratic Union (KADU), representing a coalition of small ethnic groups that had feared dominance by larger ones, dissolved itself in 1964 and joined KANU.

A small but significant leftist opposition party, the Kenya People's Union (KPU), was formed in 1966, led by Jaramogi Oginga Odinga, a former Vice President and Luo elder. The KPU was banned shortly thereafter, however, and its leader detained. KANU became Kenya's sole political party. At Kenyatta's death in August 1978, Vice President Daniel arap Moi, a Kalenjin from Rift Valley province, became interim President. By October of that year, Moi became President formally after he was elected head of KANU and designated its sole nominee for the presidential election.

In June 1982, the National Assembly amended the constitution, making Kenya officially a one-party state. Two months later, young military officers in league with some opposition elements attempted to overthrow the government in a violent but ultimately unsuccessful coup. In response to street protests and donor pressure, Parliament repealed the one-party section of the constitution in December 1991. In 1992, independent Kenya's first multiparty elections were held. Divisions in the opposition contributed to Moi's retention of the presidency in 1992 and again in the 1997 election. Following the 1997 election Kenya experienced its first coalition government as KANU was forced to cobble together a majority by bringing into government a few minor parties.

In October 2002, a coalition of opposition parties joined forces with a faction which broke away from KANU to form the National Rainbow Coalition (NARC). In December 2002, the NARC candidate, Mwai Kibaki, was elected the country's third President. President Kibaki received 62% of the vote, and NARC also won 59% of the parliamentary seats. Kibaki, a Kikuyu from Central province, had served as a Member of Parliament since Kenya's independence in 1963. He served in senior posts in both the Kenyatta and Moi governments, including Vice President and Finance Minister. In 2003, internal conflicts disrupted the NARC government, culminating in its defeat in 2005 in a referendum over the government's draft constitution. The new opposition became the Orange Democratic Movement of Kenya (ODM-K)--an alliance of former NARC members and KANU, among others. In early 2006, pro-government supporters formed the NARC-Kenya party to rival the ODM-K. Kenya is scheduled to hold presidential, parliamentary, and local government elections on December 29, 2007.

GOVERNMENT
The unicameral National Assembly consists of 210 members elected to a term of 5 years from single-member constituencies, plus 12 members nominated by political parties on a proportional representation basis. The president appoints the vice president and cabinet members from among those elected to the assembly. The attorney general and the speaker are ex-officio members of the National Assembly.

The judiciary is headed by a High Court, consisting of a Chief Justice and High Court judges and judges of Kenya's Court of Appeal, all appointed by the president.

Local administration is divided among 69 rural districts, each headed by a commissioner appointed by the president. The government has proposed 37 more districts, but these are not yet ratified by Parliament. The districts are joined to form seven rural provinces. Nairobi has special provincial status. The Ministry of State in charge of Provincial Administration and Internal Security supervises the administration of districts and provinces.

Principal Government Officials
President--Mwai Kibaki
Vice President--Moody Awori
Minister of Foreign Affairs--Raphael Tuju
Ambassador to the United States--Peter Ogego
Ambassador to the United Nations--Zachary Muita-Muburi
Consulate General Los Angeles--Ms. Nyambura Kamau

Kenya maintains an embassy in the United States at 2249 R Street NW, Washington, DC 20008 (tel. 202-387-6101, website: http://www.kenyaembassy.com) and consulates in Los Angeles and New York.

POLITICAL CONDITIONS
Since independence, Kenya has maintained remarkable stability despite changes in its political system and crises in neighboring countries. Particularly since the re-emergence of multiparty democracy, Kenyans have enjoyed an increased degree of freedom.

In December 2002, Kenyans held democratic and open elections, which were judged free and fair by international observers. The 2002 elections marked an important turning point in Kenya's democratic evolution as the presidency and the parliamentary majority passed from the party that had ruled Kenya since independence to a coalition of new political parties. The government lost a referendum over its draft constitution in November 2005. This vote too was widely accepted as free, fair and credible.

Under the presidency of Mwai Kibaki, the NARC coalition promised to focus its efforts on generating economic growth, improving and expanding education, combating corruption and rewriting the constitution. The first two goals were largely met, but progress toward the second two goals has been limited. President Kibaki's current cabinet consists of Members of Parliament from allied parties and others recruited from opposition parties who joined the cabinet without the approval of their party leaderships.

In early 2006, revelations from investigative reports of two major government-linked corruption scandals rocked Kenya and led to resignations, including three ministers (one of whom was later re-appointed). In March 2006, another major scandal was uncovered involving money laundering and tax evasion in the Kenyan banking system. The government's March 2006 raid on the Standard Group media house conducted by masked Kenyan police was internationally condemned and was met with outrage by Kenya media and civil society. The government did not provide a sufficient explanation. No one has been held accountable.

ECONOMY
After independence, Kenya promoted rapid economic growth through public investment, encouragement of smallholder agricultural production, and incentives for private (often foreign) industrial investment. Gross domestic product (GDP) grew at an annual average of 6.6% from 1963 to 1973. Agricultural production grew by 4.7% annually during the same period, stimulated by redistributing estates, diffusing new crop strains, and opening new areas to cultivation. After experiencing moderately high growth rates during the 1960s and 1970s, Kenya's economic performance during the last two decades has been far below its potential. The economy grew by an annual average of only 1.5% between 1997 and 2002, which was below the population growth estimated at 2.5% per annum, leading to a decline in per capita incomes. The decline in economic performance in the last two decades was largely due to inappropriate agricultural policies, inadequate credit, and poor international terms of trade contributing to the decline in agriculture. Kenya's inward-looking policy of import substitution and rising oil prices made Kenya's manufacturing sector uncompetitive. The government began a massive intrusion in the private sector. Lack of export incentives, tight import controls, and foreign exchange controls made the domestic environment for investment even less attractive.

From 1991 to 1993, Kenya had its worst economic performance since independence. Growth in GDP stagnated, and agricultural production shrank at an annual rate of 3.9%. Inflation reached a record 100% in August 1993, and the government's budget deficit was over 10% of GDP. As a result of these combined problems, bilateral and multilateral donors suspended program aid to Kenya in 1991. In the 1990s, the government implemented economic reform measures to stabilize the economy and restore sustainable growth. In 1994, nearly all administrative controls on producer and retail prices, imports, foreign exchange and grain marketing were removed. The Government of Kenya privatized a range of publicly owned companies, reduced the number of civil servants, and introduced conservative fiscal and monetary policies. By the mid-1990s, the government lifted price controls on petroleum products. In 1995, foreigners were allowed to invest in the Nairobi Stock Exchange (NSE). In July 1997, the Government of Kenya refused to meet commitments made earlier to the International Monetary Fund (IMF) on governance reforms. As a result, the IMF suspended lending for 3 years, and the World Bank also put a $90-million structural adjustment credit on hold.

The Government of Kenya took some positive steps on reform, including the establishment of the Kenyan Anti-Corruption Authority in 1999, and the adoption of measures to improve the transparency of government procurements and reduce the government payroll. In July 2000, the IMF signed a $150 million Poverty Reduction and Growth Facility (PRGF), and the World Bank followed suit shortly after with a $157 million Economic and Public Sector Reform credit. The Anti-Corruption Authority was declared unconstitutional in December 2000, and other parts of the reform effort faltered in 2001. The IMF and World Bank again suspended their programs.

Net foreign direct investment (FDI) was negative from 2000-2003, but started trickling back in 2004, as demonstrated by an increase in the number of enterprises operating in Export Processing Zones (EPZs) from 66 to 74 between 2003 and 2004. The value of total investments increased from Ksh18.7 billion (U.S. $247.3 million) in 2005 to Ksh20.1 billion (over U.S. $278.3 million) in 2006. Following the end of the Multifiber Arrangement (MFA) textile agreement in January 2005, several textile and apparel factories closed, leaving 68 EPZ enterprises. In 2006, this number increased to 70 EPZ enterprises.

The economy began to recover after 2002, registering 2.8% growth in 2003, 4.3% in 2004, 5.8% in 2005, and 6.1 % in 2006. Under the leadership of President Kibaki, who took over on December 30, 2002, the Government of Kenya began an ambitious economic reform program and resumed its cooperation with the World Bank and the IMF. The National Rainbow Coalition (NARC) government enacted the Anti-Corruption and Economic Crimes Act and Public Officers Ethics Act in May 2003 aimed at fighting graft in public offices. There was some movement to reduce corruption in 2003, but the government did not sustain that momentum. Other reforms especially in the judiciary, public procurement etc, led to the unlocking of donor aid and a renewed hope of economic revival.

In November 2003, following the signing into law of key anti-corruption legislation and other reforms by the new government, donors reengaged as the IMF approved a three-year $250 million Poverty Reduction and Growth Facility and donors committed $4.2 billion in support over 4 years. In December 2004, the IMF approved Kenya's Poverty Reduction and Growth Facility (PRGF) arrangement equivalent to U.S. $252.8 million to support the government's economic and governance reforms. However, the government's ability to stimulate economic demand through fiscal and monetary policy remains fairly limited while the pace at which the government is pursuing reforms in other key areas remains slow. Although the Privatization Law was enacted in 2005, modest steps have been made on privatizing of parastatals apart from Kenya Electricity Generating Company (KenGen) and the concessioning of Kenya Railways, while civil service reform is limited despite the government's assertion that reforms would be undertaken. Accelerating growth to achieve Kenya's potential and reduce the poverty that afflicts more than 56% of its population will require continued de-regulation of business, improved delivery of government services, addressing structural reforms, massive investment in new infrastructure (especially roads), reduction of chronic insecurity caused by crime, and improved economic governance generally.

The current expansion is fairly broad-based and is built on a stable macro-environment fostered by government, and the resilience, resourcefulness, and improved confidence of the private sector. Nairobi continues to be the primary communication and financial hub of East Africa. It enjoys the region's best transportation linkages, communications infrastructure, and trained personnel, although these advantages are less prominent than in past years. On January 31, 2007, the government signed a $2.7 million contract with Tyco Telecommunications to perform an undersea survey for the construction of a fiber-optic cable to Fujairah in the United Arab Emirates (U.A.E.) called the East African Marine Systems (TEAMS). Two other fiber-optic cables projects are being pursued to link Kenya to the rest of East Africa and India. Once TEAMS and the domestic fiber-optic cables planned by the government are completed, the economy is expected to benefit significantly from reduced internet access prices and improved capacity. A wide range of foreign firms maintain regional branches or representative offices in the city. In March 1996, the Presidents of Kenya, Tanzania, and Uganda re-established the East African Community (EAC). The EAC's objectives include harmonizing tariffs and customs regimes, free movement of people, and improving regional infrastructures. In March 2004, the three East African countries signed a Customs Union Agreement paving the way for a common market. The Customs Union and a Common External Tariff were established on January 1, 2005, but the EAC countries are still working out exceptions to the tariff. Rwanda and Burundi have since joined the community. In May 2007, during a Common Market for Eastern and Southern Africa (COMESA) Summit, 13 heads of state endorsed a move to adopt a COMESA customs union and set December 8, 2008 as the target date for its adoption.

Tourism is now Kenya's largest foreign exchange earning sector, followed by flowers, tea and coffee. In 2006 tourism generated $803 million, up from $699 million the previous year. Africa is Kenya's largest export market, followed by the European Union (EU). Kenya benefits significantly from the African Growth and Opportunity Act (AGOA). Although Congress renewed the AGOA third-country fabric provision in December 2006 to provide more time to develop local cotton and fabric production that meets the buyers' rigorous standards, its apparel industry is struggling to hold its ground against Asian competition. Kenya's main exports to the U.S. are AGOA-program garments, but it continues to run a trade deficit with the U.S.

Kenya faces profound environmental challenges brought on by high population growth, deforestation, shifting climate patterns, and the overgrazing of cattle in marginal areas in the north and west of the country. Significant portions of the population will continue to require emergency food assistance in the coming years.

FOREIGN RELATIONS
Despite internal tensions in Sudan and Ethiopia, Kenya has maintained good relations with its northern neighbors. Recent relations with Uganda and Tanzania have improved as the three countries work for mutual economic benefit.

Kenya has hosted and played an active role in the negotiations to resolve the civil war in Sudan and to reinstate a central government authority in Somalia. The Sudan peace negotiations have made major progress, resulting in the signing in Kenya of agreements between the Khartoum government and the southern Sudan rebels to put an end to the two-decade-long war. On January 9, 2005 a Sudan North-South Comprehensive Peace Accord was signed in Nairobi. Negotiations in the Somali National Reconciliation Conference resulted at the end of 2004 in the establishing of Somali Transitional Federal Institutions (Assembly, President, Prime Minister, and Government). Until early 2005, Kenya served as a major host both for these institutions and for refugees from Somalia as well as Sudan. Between May and June 2005, members of the Somalia Transitional Federal Institutions relocated to Somalia.

Kenya maintains a moderate profile in Third World politics. Kenya's relations with Western countries are generally friendly, although current political and economic instabilities are sometimes blamed on Western pressures.

U.S.-KENYAN RELATIONS
The United States and Kenya have enjoyed cordial relations since Kenya's independence. More than 5,000 U.S. citizens live in Kenya. In 2006 a record 86,528 Americans visited Kenya, up 17.6% from 2005. About two-thirds of the resident Americans are missionaries and their families. U.S. business investment is estimated to be more than $285 million, primarily in commerce, light manufacturing, and the tourism industry.

U.S. assistance to Kenya promotes broad-based economic development as the basis for continued progress in political, social, and related areas of national life. U.S. aid strategy is designed to achieve four major objectives--improving health care, including family planning and AIDS prevention; increasing rural incomes by assisting small enterprises and boosting agricultural productivity; promoting sustainable use of natural resources; and strengthening democratic institutions. The Peace Corps has 150 volunteers in Kenya.

Principal U.S. Officials
Ambassador--Michael E. Ranneberger
Deputy Chief of Mission--Pamela Slutz
USAID Mission Director--Stephen Haykin
Public Affairs Officer--Robert C. Kerr

The U.S. Embassy in Kenya is located on UN Avenue, Nairobi, P.O. Box 606, Village Market, Nairobi (tel. 254-20-363-6000; fax 254-20-363-6157).