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Biden: New Kenya Constitution Will Lead to More American Investment

Visiting U.S. Vice President Joe Biden has told Kenya the successful passage of a new constitution and other key political reforms will result in more American investment in the east African nation.

Speaking in Nairobi, Vice President Biden said American companies are eager to do business in Kenya.  He said more opportunities would present themselves if political and economic reforms were carried out as promised.

"Putting in place a new constitution and strengthening your democratic institutions and rule of law will further open the door to major American development programs such as the Millennium Challenge Account, and will, I predict, bring about reinvestment by American corporations and international organizations in Kenya that can provide millions of dollars in assistance and grants," said the vice president.

Biden spoke after talks with Kenyan President Mwai Kibaki and Prime Minister Raila Odinga, the leaders of the country's two main political parties, which formed a coalition government following a disputed presidential election in 2007.

After two and a half years and repeated delays, the country is preparing for a constitutional referendum.  President Kibaki says the vote will give the people of Kenya what they need.

"The referendum on a new constitution scheduled for 4th August this year is the most important reform initiative for the grand coalition government.  We are confident that through this process, Kenyans will get a new constitution," he said.

Experts say the result of the August referendum could have major economic implications for the country.  A new constitution could change perceptions of Kenya and spark investment.  

If the public turns against the document, analysts say, investors are likely to turn their backs on the country, deeming an uncertain political environment too risky.

An economically weakened Kenya also presents security issues for the region.  President Kibaki has asked Vice President Biden for more engagement from the U.S. in stabilizing neighboring Somalia.  Kibaki said both governments share concerns about piracy in the Indian Ocean and the threat of extremist groups operating in Somalia.

Biden said he recognizes Kenya's efforts in combating threats from Somalia. "I assured the president and the prime minister that the United States supports the efforts to secure the border in the face of very real threats from those who wish to spread chaos through despair and violence.  We recognize that Kenya's long-time stability and development are tied to regional security and development," he said.

The United States has already warned of the need for haste in preparing for a January referendum on the autonomy of southern Sudan from Khartoum.  A 'yes' vote is expected to have wide-reaching effects on all of east Africa, and pressure is building on Sudan's neighbors to ensure the credibility of the process.  Biden is scheduled to meet with Southern Sudanese President Salva Kiir later this week.

Experts say Kenya's role in the security of east Africa is the main reason why the country has received $2.2 billion of the $6.7 billion in U.S. economic and security assistance to the region in the past 16 years.

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