KENYA: AFRICA’S NEW POWERHOUSE

Obinna S. Alozie

AFR 110

11/25/2014

KENYA: AFRICA’S NEW POWERHOUSE

East African countries, especially, Kenya, has recently been going through a couple of changes, economic changes that is. Kenya, along with Uganda, Tanzania, Rwanda and Burundi, all whom are members of the EAC, the East African Community, has been experiencing a series of high rates of economic growth in Africa. According to the article, African Powerhouse by Mwangi S. Kimenyi and Josephine Kibe, the region of East Africa “has fast-tracked regional integration and has seen considerable progress in institutional reforms. Moreover, East Africa boasts much greater political stability than it has at any time in its recent past, and peace has been restored in most of the countries. The region has also seen major investments in both national and regional infrastructure; many more projects have been planned and are scheduled to commence shortly. On Nov. 28, for example, President Uhuru Kenyatta of Kenya inaugurated the commencement of construction of a rail project that will link Kenya’s coast town of Mombasa to Kampala (Uganda), Kigali (Rwanda), and Juba (South Sudan). With positive growth trajectory predicted over the medium term, the EAC has a good chance of reaching a developmental tipping point”.

Inside the EAC, the Kenyan economy is the “glue” that holds everything and everyone together. In order to achieve an overall performance of the East Africa, a lot of it will, to a great extent, depend on what happens in Kenya. With the Kenyan economy being one of the largest in the region, it’s a lot more dynamic than those other East African countries. What links Kenya’s economy is to the other economies? Investment flows and trade. The Kenyan economy is expected to maintain its strength, creating valuable benefits to the other member countries, thanks to its more advanced human capital base, even more diversified economy, and its role as a leader in the revolution of information communication in the region. With current institutional reforms that has culminated in the recent acceptance of a new constitution that has provided devolved governance, the prospects for a strong economy are extremely high.

Why is the Kenyan economy very strong? There are several reasons why. One reason is a strong private sector that has evolved under fairly market-friendly policies for most of the post-independence era, Kenya’s economy has dominated in other economies in the East African region. Another reason is Kenya’s record of relative political stability and its lack of dramatic ideological shifts over the same period, which has done much to cement its position. Unlike Kenya, the other members of the EAC have had a rather stormy political histories. For example, take Tanzania. A radical ideological orientation to socialism under the “Ujamaa” policy became the cornerstone of the government of founding President Julius Nyerere. Elements like this completely undermined the possible growth of the private sector in the other EAC countries. Even though these countries have taken on substantive reforms, and are now on a positive growth trajectory, Kenya is still more likely to hold onto its dominant position for the near and coming future.

Now this writer is not saying that Kenya is perfect. In fact, Kenya is far from perfect. Kenya is a “country has had its share of politically instigated violence along ethnic divisions and tribal lines. Even though elections in Kenya have been marred by flaws and irregularities, the country is considered to have a wider democratic space compared to its neighbors”. With several issues that coexist with these rising economies in Africa, they still require important investments in three “I’s”: institutions, integration, and infrastructure. With an adoption of a new constitution, Kenya is on its way to its potential destiny: Becoming an Economic Powerhouse.