Analysts warn that the post-election violence in Kenya could scare away foreign investors.
Beat Siegenthaler is the chief strategist for emerging markets for TD Securities. From London, he spoke to VOA English to Africa Service reporter Joe De Capua about reaction among investors to Kenya’s political situation.
“I think there are quite a number of concerns. And I think the most serious one is that Kenya has been one of the most stable countries politically and now we see these kind of events, which will I think frighten off some investors, which always are on the lookout for new opportunities, new countries, particularly in Africa. And I think there will be to some extent quite shocked about these events and it will impact their investment decisions going forward.” he says.
Siegenthaler says it could also adversely affect investments in other African countries as well “because people tend to be not that well informed about those countries and when they see these kind of headlines it’s quite concerning.”
Asked what Kenyan officials would have to do to counter the negative image of their country caused by the violence, he says, “What governments have to do in this kind of situation is to assure people that on the policy side, in terms of monetary policy, economic policy, the business environment, that things will be kept stable or that things will continue as they were before.” He adds, though, that could be difficult when there’s a high level of violence.
Siegenthaler says other countries where investors could turn instead include South Africa, Turkey, Russia and Brazil. He says foreign investment is a crucial part of Kenya’s economy.