News / Economy

Bombings Threaten Kenya Growth Goals

FILE - Bomb experts carry out investigations at the scene of an explosion along Biashara street in the Kenyan coastal city of Mombasa, May 22, 2014.
FILE - Bomb experts carry out investigations at the scene of an explosion along Biashara street in the Kenyan coastal city of Mombasa, May 22, 2014.
Reuters
Recent bombings in Kenya have dented President Uhuru Kenyatta's plans to boost tourism and undermined his pledge to restore security after last year's Westgate shopping mall attack.

Travel warnings issued by the United States, Britain, France and Australia last month have sent their citizens packing, emptying Kenya's palm-fringed beaches and forcing hotels to lay off staff.

On taking office last year Kenyatta vowed to lift tourist numbers to five million annually within five years, three times' last year's level, and get economic growth into double figures in his bid to raise incomes and lift millions out of poverty.

Those targets always looked optimistic to economists and seem further out of reach following a spike in attacks on Kenya, blamed on militants linked to Somalia, this year.

The travel alerts are also a fresh point of friction between the West and Kenyatta, whose pending trial at the International Criminal Court (ICC) has cast a shadow over relations with a nation seen as an ally in the battle against militant Islam.

"The West risks opening a new divide with Kenyatta as they did with the ICC, but the tension so far appears more benign," said Macharia Munene, a university lecturer in Nairobi.

Western governments said they could only have limited contacts with a leader facing charges of inciting ethnic killings after violence during elections in 2007 left about 1,200 dead. Kenyatta denies the charges and his case has been delayed due to a lack of witnesses.

The travel advisories have put the coastal city of Mombasa, where suspected Islamist bombers killed three people this month, off-limits to many tourists. Western governments have also urged vigilance elsewhere. As tourists fled, jobs have also gone.

"I was sent home... because there weren't enough visitors at the hotel," said 27-year-old Tumaini Sidi, a maid at the luxury Sai Rock Beach & Spa Hotel in Mombasa.

Beach resorts and safari lodges now face the challenge of securing bookings for the crucial July-September period, as Somalia's al Shabaab Islamist group has threatened more strikes if Kenya doesn't pull troops out of Somalia. Kenya said it won't quit Somalia.

Chinese tourists

Tourism is Kenya's second-biggest source of foreign exchange after agriculture, earning $1.02 billion last year or about 12 percent of the nation's gross domestic product.

But those figures only tell half the story. The industry is a major employer, providing about 500,000 jobs directly and generating work for a host of support industries, from food suppliers right down to vendors selling trinkets on the street.

Some 900 tourists cut short their holidays after Britain issued its warning on Mombasa on May 14, weighing on an industry that saw tourist numbers slide to 1.5 million last year after an all-time peak of 1.8 million in 2011.

If the decline deepens severely this year, some economists say it could shave 1 percentage point or more off economic growth, which the IMF forecasts at 5.5-6 percent.

"Kenyatta's double-digit target for economic growth was already overly optimistic, but the continued decline in the tourism sector will further complicate efforts to boost growth,'' said Sarah Collier at UK-based risk consultancy Maplecroft.
        
Worries of violence during last year's election had deterred many from visiting the country's white sandy beaches and game parks. A peaceful vote raised hopes for an upturn, only to be dashed when Al Shabaab gunmen stormed Nairobi's upmarket Westgate mall in September 2013, gunning down shoppers. At least 67 people died.

Kenyatta, whose family business empire includes a chain of hotels, is now trying to shore up the industry by encouraging domestic tourism: waiving taxes on air tickets and offering tax breaks to firms who pay staff holidays.
       
As Europeans, who account for nearly half of Kenya's tourists, become wary, the government is eying more visitors from China, but that is a long-term plan. There were only 38,000 Chinese visitors in the 2012/2013 fiscal year.

Central Bank Governor Njuguna Ndung'u played down prospects for a downturn in tourism that would hurt growth. ``It could only be a temporary hiccup,'' he told Reuters, citing a forecast of 5.6 percent for growth in fiscal 2014/15 starting July 1.    But if security worsens it could have a broader effect.

"The impact of the security situation on domestic confidence is far more important as a driver of growth,'' said Razia Khan, head of Africa research at Standard Chartered bank said. "This is where Kenya faces its greatest vulnerability."

Playing politics

Kenya insists it is on top of security and is tracking militants. "We are guarding... all known crowded areas within the city," said Nelson Marwa, Mombasa county government commissioner. "You will not see us but we are there."
       
Deputy President William Ruto said the government was being blamed for attacks that got through without being credited for the many more it has stopped.
        
Some Western diplomats, though, voiced frustration that Kenya had not bolstered security more robustly after Westgate. No top officials lost jobs over the attack, even when troops were found to have looted the mall during the four-day siege.
       
Western diplomats and security experts also say security forces are being hampered by poor coordination between agencies. And Kenyan strong-arm tactics can be counter-productive, despite counter terrorism and other training from Britain, the United States and Israel amongst others.

One diplomat pointed to the rounding up of hundreds of people from a Somali-dominated area of Nairobi after recent bombings.

"All it does is turn them more against you," he said, adding Kenya had to do more to win the battle against militant ideas and address the issues driving recruitment.
       
Al-Shabab has not claimed responsibility for the May attacks in Nairobi and Mombasa, which has prompted some to question whether the government is right to blame it. Officials insist it is al Shabaab or their sympathizers. Al Shabaab could not be reached for comment.

This highlights the challenge facing Kenya. Kenyan experts say al Shabaab may be increasingly turning to "hired hands'' from Kenya's own radicalized youth, many of them drawn from the Muslim community, which makes up 15 percent of the population.
        
"It is rented terrorists," said Mutahi Ngunyi of Nairobi-based consultancy firm Consulting House.

Privately, some Kenyan officials also say Washington and European governments are playing politics, seeking to punish Nairobi for its closer ties with Beijing and for awarding new contracts, such as a new railway, to China rather than the West.
        
Western states, who are big aid donors, say they are only acting because of security worries.

"We are not allowed to politicize security," said John Bradshaw, the British High Commission spokesman in Nairobi.

You May Like

Conflicts Engulf Christians in Mideast

Research finds an increase in faith-based hostilities, and Christians are facing persecution in a growing number of countries in the region More

Chinese Americans: Don’t Call Us 'Model Minority'

Label points to collective achievement, but some say it triggers resentment, unrealistic expectations More

Iran Bolsters Phone, Internet Surveillance

Does increased monitoring suggest the government is nervous? More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
West Africa Ebola Vaccine Trials Possible by Early 2015i
X
Carol Pearson
August 30, 2014 7:14 PM
A U.S. health agency is speeding up clinical trials of a possible vaccine against the deadly Ebola virus that so far has killed more than 1,500 people in West Africa. If successful, the next step would be a larger trial in countries where the outbreak is occurring. VOA's Carol Pearson has more.
Video

Video West Africa Ebola Vaccine Trials Possible by Early 2015

A U.S. health agency is speeding up clinical trials of a possible vaccine against the deadly Ebola virus that so far has killed more than 1,500 people in West Africa. If successful, the next step would be a larger trial in countries where the outbreak is occurring. VOA's Carol Pearson has more.
Video

Video Survivors Commemorate 70th Anniversary of Nazi Liquidation of Polish Ghetto

When the Nazi army moved into the Polish city of Lodz in 1939, it marked the beginning of a long nightmare for the Jewish community that once made up one third of the population. Roughly 200,000 people were forced into the Lodz Ghetto. Less than 7,000 survived. As VOA’s Kane Farabaugh reports, some survivors gathered in Chicago on the 70th anniversary of the liquidation of the Lodz Ghetto to remember those who suffered at the hands of the Nazi regime.
Video

Video Cost to Raise Child in US Continues to Rise

The cost of raising a child in the United States continues to rise. In its latest annual report, the U.S. Department of Agriculture says middle income families with a child born in 2013 can expect to spend more than $240,000 before that child turns 18. And sending that child to college more than doubles that amount. VOA’s Deborah Block visited with a couple with one child in Alexandria, Virginia, to learn if the report reflects their lifestyle.
Video

Video Chaotic Afghan Vote Recount Threatens Nation’s Future

Afghanistan’s troubled presidential election continues to be rocked by turmoil as an audit of the ballots drags on. The U.N. says the recount will not be completed before September 10. Observers say repeated disputes and delays are threatening the orderly transfer of power and could have dangerous consequences. VOA correspondent Meredith Buel reports.
Video

Video Ukraine Battles Pro-Russia Rebel Assault

After NATO concluded an emergency meeting to discuss the crisis in eastern Ukraine, the country is struggling to contain heavy fighting near the strategic port of Mariupol, on the Azov Sea. Separatist rebels are trying to capture the city, allegedly with Russian military help, and Ukraine's defense forces are digging in. VOA's Daniel Schearf spoke with analysts about what lies ahead for Ukraine.
Video

Video Growing Business Offers Paint with a Twist of Wine

Two New Orleans area women started a small business seven years ago with one thing in mind: to help their neighbors relieve the stress of coping with a hurricane's aftermath. Today their business, which pairs painting and a little bit of wine, has become one of the fastest growing franchises across the U.S. VOA’s June Soh met the entrepreneurs at their newest franchise location in the Washington suburbs.
Video

Video Ebola Vaccine Trials To Begin Next Week

The National Institutes of Health says it is launching early stage trials of a vaccine to prevent the Ebola virus, which has infected or killed thousands of people across West Africa. The World Health Organization says Ebola could infect more than 20,000 people across the region by the time the outbreak is over. The epidemic has health experts and governments scrambling to prevent more people from becoming infected. Zlatica Hoke has more.
Video

Video Asian Bacteria Threatens Florida Orange Trees

Florida's citrus fruit industry is facing a serious threat from a bacteria carried by the Asian insect called psyllid. The widespread infestation again highlights the danger of transferring non-native species to American soil. VOA’s George Putic reports.
Video

Video Aging Will Reduce Economic Growth Worldwide in Coming Decades

The world is getting older, fast. And as more people retire each year, fewer working-age people will be there to replace them. Bond rating agency Moody’s says that will lead to a decline in household savings; reducing global investments - which in turn, will lead to slower economic growth around the world. But experts say it’s not too late to mitigate the economic impact of the world’s aging populations. Mil Arcega has more.
Video

Video Is West Doing Enough to Tackle Islamic State?

U.S. President Barack Obama has ruled out sending ground troops to Iraq to fight militants of the so-called Islamic State, or ISIS, despite officials in Washington describing the extremist group as the biggest threat the United States has faced in years. Henry Ridgwell reports from London on the growing uncertainty over whether the West’s response to ISIS will be enough to defeat the terrorist threat.
Video

Video Coalition to Fight Islamic State Could Reward Assad

The United States along with European and Mideast allies are considering a broader assault against Islamic State fighters who have spread from Syria into Iraq and risk further destabilizing an already troubled region. But as VOA State Department Correspondent Scott Stearns reports, confronting those militants could end up helping the embattled Syrian President Bashar al-Assad.
Video

Video Made in America Socks Get Toehold in Online Fashion Market

Three young entrepreneurs are hoping to revolutionize the high-end sock industry by introducing all-American creations of their own. And they’re doing most of it the old-fashioned way. VOA’s Julie Taboh recently caught up with them to learn what goes into making their one-of-a-kind socks.
Video

Video Americans, Ex-Pats Send Relief Supplies to West Africa

Health organizations from around the world are sending supplies and specialists to the West African countries that are dealing with the worst Ebola outbreak in history. On a smaller scale, ordinary Americans and African expatriates living in the United States are doing the same. VOA's Carol Pearson reports.

AppleAndroid

World Currencies

EUR
USD
0.7537
JPY
USD
103.79
GBP
USD
0.6032
CAD
USD
1.0957
INR
USD
60.522

Rates may not be current.