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Kenyan Violence Threatens Once Thriving Economy


The World Bank is warning that post-election unrest in Kenya is threatening east Africa's largest economy and could wipe out impressive gains the country has achieved in recent years. As VOA Correspondent Alisha Ryu reports from the Kenyan capital Nairobi, widespread violence, triggered by allegations of vote-rigging in last Thursday's hotly-contested elections, has disrupted transportation and closed businesses, creating food and fuel shortages in Kenya.

The Kenyan government estimates that it has lost more than $60 million in revenue since Sunday, when the capital and other parts of the country exploded in political and tribal violence over the re-election of President Mwai Kibaki.

Mr. Kibaki, a member of Kenya's dominant ethnic Kikuyu tribe, was declared the winner of an election that was too close to call before the December 27 vote. The opposition, led by Raila Odinga, an ethnic Luo who has the support of many other tribes, charged the election was rigged. International observers have also questioned the final tally.

Battles between protesters and police and ethnic clashes have killed more than 300 people in Nairobi, the Rift Valley, and the coastal town of Mombasa and have paralyzed the country.

Many businesses, closed for the Christmas holidays, have been unable to open for fear of looting or because employees have been unable to travel to work safely.

Grocery stores in Nairobi and other parts of the country are reportedly running out of basic goods such as flour, oil, milk, and bread, and gas stations have started to close because trucks have not been able to make fuel deliveries.

Jane Wangui owns a hair salon in downtown Nairobi, one of a handful of shops in the area open for business on Friday.

She says she fears a prolonged political crisis could mean financial ruin for her and many other small business owners.

"Everyday, we are losing money, we are losing clients, and it gets to a point where we cannot pay our employees because there is no money coming in. So, we have to work. What I am doing right now is praying to God that things will come back to normal," she said.

On Wednesday, the World Bank expressed concern that Kenya's impressive economic growth, averaging about six percent per year since 2005, could be erased if the unrest continues.

The country's key tourism industry, which earns Kenya $800 million annually, has already been hit by cancellations from tour operators worldwide. Many tourists who are here are cutting their vacations short and heading home.

A Nairobi-based economic analyst and commentator, Robert Shaw, says although Kenya has been rocked by riots and ethnic fighting in previous years, the unrest this time has been particularly damaging because Kenya had been steadily attracting foreign investors, eager to participate in the country's booming economy.

"And now, that confidence is being put into question," said Shaw. "Even if things are resolved tomorrow, you cannot forget what has happened in the last week and whether it will repeat itself."

To avert a nation-wide fuel and banking crisis, the Kenyan police have offered to provide free escort to companies transporting money to banks and trucks carrying fuel.

Local media say fuel shortages have stranded hundreds of motorists and commuters in towns along the Mombasa-Nairobi highway and in some rural parts of Kenya.

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