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Kenya Background

Founding president and liberation struggle icon Jomo KENYATTA led Kenya from independence until his death in 1978, when current President Daniel Toroitich arap MOI took power in a constitutional succession. The country was a de facto one-party state from 1969 until 1982 when the ruling Kenya African National Union (KANU) made itself the sole legal party in Kenya. MOI acceded to internal and external pressure for political liberalization in late 1991. The ethnically fractured opposition failed to dislodge KANU from power in elections in 1992 and 1997, which were marred by violence and fraud, but are viewed as having generally reflected the will of the Kenyan people. President MOI stepped down in December of 2002 following fair and peaceful elections. Mwai KIBAKI of the Democratic Party of Kenya defeated KANU candidate Uhuru KENYATTA and assumed the presidency following a campaign centered on an anticorruption platform.

Kenya Economy

Kenya, the regional hub for trade and finance in East Africa, is hampered by corruption and reliance upon several primary goods whose prices continue to decline. Following strong economic growth in 1995 and 1996, Kenya's economy has stagnated, with GDP growth failing to keep up with the rate of population growth. In 1997, the IMF suspended Kenya's Enhanced Structural Adjustment Program due to the government's failure to maintain reforms and curb corruption. A severe drought from 1999 to 2000 compounded Kenya's problems, causing water and energy rationing and reducing agricultural output. As a result, GDP contracted by 0.3% in 2000. The IMF, which had resumed loans in 2000 to help Kenya through the drought, again halted lending in 2001 when the government failed to institute several anticorruption measures. Despite the return of strong rains in 2001, weak commodity prices, endemic corruption, and low investment limited Kenya's economic growth to 1%, and Kenya is unlikely to see growth above 2% in 2002. Substantial IMF and other foreign support is essential to prevent a further decline in real per capita output.

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