Politics
Kenya Grapples with Investor Confidence Crisis Amid Tax Protest Fallout
Kenyan youthful protestors come face to face with tear gas fumes during demonstrations triggered by a real feeling, the administration of President Willaim Ruto is insensitive to the populace who are opposed to tax increaseses as envisioned by the Ruto regime.
::Kenya’s Fiscal Reckoning: Investor Confidence Strained, Debt Burdened, Strategic Reforms Vital for Economic Revival and Global Investment Appeal
By Charles Wachira
Kenya is currently facing a significant investor confidence crisis following widespread protests that forced the government to shelve its proposed tax increases outlined in the Financial Bill 2024. These protests, which escalated to fatal levels in some regions, erupted nationwide in response to the government’s efforts to enhance revenue streams and stabilize public finances.
The proposed tax measures aimed to generate approximately KSh 90 billion ($820 million) in additional revenue, crucial for funding essential public services and reducing the country’s growing debt burden. Kenya’s public debt stands at around 70% of GDP, highlighting the urgency for fiscal consolidation and sustainable debt management strategies.
The abrupt withdrawal of the tax plans has reverberated across domestic and international financial markets. Credit-default swaps, a key indicator of sovereign credit risk, have surged by more than 80 basis points over the past month, reflecting heightened concerns among global investors about Kenya’s economic stability and its capacity to effectively address fiscal challenges.
International observers and financial institutions have closely monitored these developments, expressing apprehensions about Kenya’s fiscal governance and political stability. The protests have underscored deep-seated socio-economic disparities and exposed the delicate equilibrium between revenue generation and public sentiment.
In navigating this volatile period, restoring investor confidence remains a critical priority. The government’s responsiveness to public concerns and its ability to outline a clear economic strategy will be scrutinized closely. Stakeholders across various sectors will monitor policy decisions and economic indicators for indications of stability and recovery in Kenya’s investment environment.
The aftermath of this crisis extends beyond immediate financial markets, shaping perceptions of Kenya’s long-term economic prospects. Effective resolution and proactive measures to address underlying economic challenges will be essential in rebuilding trust and positioning Kenya as a resilient and attractive investment destination on the global stage.
Keywords:Investor Confidence Crisis:Financial Bill 2024:Kenya Public Debt:Tax Protests:Economic Stability:
Politics
Kenya’s presidents have a long history of falling out with their deputies – Rigathi Gachagua’s impeachment would be no surprise
Amid the novelty of the impeachment process, it’s easy to forget that it is the norm for Kenyan presidents to fall out with their deputies.
By Gabrielle Lynch, Professor of Comparative Politics, University of Warwick
Initially published @ https://theconversation.com/
The process of removing Kenya’s deputy president Rigathi Gachagua is part of a long history, dating back to independence, of fallouts between the president and his deputy. The difference this time around is the process.
Historically, presidents have fired their deputies. But the adoption of a new constitution in 2010, saw the introduction of a process for impeachment – for both the president and the deputy – that’s run by the legislature. This is the first time it’s been used.
On 8 October 2024, members of Kenya’s national assembly voted to impeach Gachagua on grounds that included corruption, insubordination and ethnically divisive politics. The case now moves to the senate where members will hear the charges – and Gachagua’s defence – and vote.
If at least two-thirds of senate accept the charges, and Gachagua’s legal challenges fail, then Gachagua will make history as Kenya’s first deputy leader to be impeached.
So far, President William Ruto has stayed silent on the matter, but the process would not be proceeding without his blessing.
Amid the novelty of the impeachment process, it’s easy to forget that it is the norm for Kenyan presidents to fall out with their deputies. As a political scientist interested in Kenya’s ethnic politics and democratisation, I argue that this is because of how deputies are selected in the first place.
Deputies are initially selected largely on pragmatic grounds as people who bring something useful to a political alliance. This could be resources, a support base or a reputation for being a good technocrat or administrator.
They’re not usually people with whom the president has a strong and continuous personal relationship or someone with whom they share a clear political ideology. Neither are they usually someone who has made their way up through a political party.
This has brought about a long history of tensions and fallout between Kenya’s presidents and their deputies.
History of fallouts
Independent Kenya’s first vice president, Oginga Odinga, saw his ministerial portfolio gradually reduced by President Jomo Kenyatta. Kenyatta then replaced Odinga as vice president of the ruling Kenya African National Union (Kanu) in 1966 further undermining his powers. Soon after, Odinga joined the opposition Kenya’s People’s Union.
His successor, Joseph Murumbi, resigned within months. The official reason given was ill health, but it is widely believed that Murumbi was troubled by corruption and authoritarianism within the Kenyatta regime.
Kenya’s second president, Daniel arap Moi, elected Mwai Kibaki as his first deputy. Kibaki was dropped after a decade. He went on to form an opposition party as soon as Kenya shifted to multi-party politics in 1992.
Moi’s second vice president, Josephat Karanja, resigned after a year to avoid a vote of no confidence for allegedly plotting to overthrow the government.
Moi’s third deputy, George Saitoti was sidelined to pave way for Uhuru Kenyatta’s nomination as the party flagbearer in 2002. Moi’s final deputy, Musalia Mudavadi, fell with the rest of the Kanu government in the 2002 elections.
As Kenya’s third president, Kibaki similarly oversaw a regular change of guard. His first deputy, Michael Wamalwa, died after a few months in office. His second, Moody Awori, lost his seat in the 2007 election.
Kibaki’s third deputy, Kalonzo Musyoka, joined the president during Kenya’s post-election violence of 2007-08. He left at the end of his term in 2013 to run with Raila Odinga in the 2013, 2017 and 2022 presidential elections.
Kenya’s fourth president, Uhuru Kenyatta, was the only leader to have the same deputy, William Ruto, for his full term as president – from 2013 to 2022. However, relations between Kenyatta and Ruto were hardly rosy. The two fell out after the 2017 elections as Kenyatta teamed up with long-standing opposition leader, Raila Odinga. Ruto beat Odinga, Kenyatta’s favoured candidate in the 2022 elections.
Lessons to learn
Because deputies are selected for their practical value, the person who made a good deputy at one point in time can come to be seen as a liability or threat as the political context changes.
For example, at independence, Oginga Odinga made an excellent ally for Jomo Kenyatta. He had some resources and was a proven mobiliser. He brought a support base. However, within a few years, Odinga became a problem for the president as a more radical faction within the ruling party coalesced around him.
Similarly, Ruto made an excellent ally for Uhuru Kenyatta when they both faced charges for crimes against humanity at the International Criminal Court. The two fell out once Kenyatta had won his second and final term, and Kenyatta turned to his succession.
Gachagua was useful to Ruto in 2022. He had personal wealth, was an effective mobiliser and hailed from central Kenya where the election looked to be won or lost. However, once elected, Gachagua’s populist statements and reputation for ethnic bias became more of a liability.
Second, as contexts change, someone else can soon come to be seen as more useful as second in command.
For Jomo Kenyatta, Moi had shown his utility and loyalty during the “little general elections” of 1966, which effectively sidelined the Kenya People’s Union and Oginga Odinga.
Kithure Kindiki, Kenya’s interior cabinet secretary, is the current frontrunner to replace Gachagua. He is seen as better able to negotiate with the international community, especially during a critical economic period for Kenya as it seeks new International Monetary Fund loans.
Third, being the country’s vice or deputy president comes with a lot of opportunities to network. These interactions have often led individuals to be seen as a growing threat, or as actively plotting against the president. They may also be seen as a future challenger.
History has shown that there is no ideal way of dealing with such a potential challenger, leading subsequent presidents to try different approaches.
Current context
Ruto and Gachagua have clearly fallen out. Their differences became apparent soon after the 2022 elections. However, they came into sharp relief in the face of anti-tax protests in June 2024. There were subsequent allegations that Gachagua and some of his allies had helped to finance the protests.
The question, therefore, isn’t why they have fallen out but why Gachagua is being impeached now.
Ultimately the answer to this can only be known by a few individuals. But perhaps an indication of the answer lies in the emotions the fallout has stirred: a desire to distract the public and show that the government is taking action to deal with Kenya’s ongoing economic crisis. There may also be a desire to undercut Gachagua before he can build national networks.
Ruto has the numbers in the senate to see the impeachment process through. But this is a dangerous game. Those sidelined have a habit of coming back to haunt their former allies.
At the moment, most Kenyans are supportive of the impeachment process, but many also feel that Gachagua is being unfairly targeted especially in central Kenya, where a majority oppose the process.
While a successful impeachment might see Gachagua barred from holding public office, this wouldn’t necessarily mean an end to his career as an effective political mobiliser.
The next few months – and the narratives that emerge about why Ruto and Gachagua fell out – will be critical in determining both their futures.
Politics
Kenya Pushes Economic Growth with $20M Holistic Productive Capacities Programme by UNCTAD
In 2025, Kenya will unveil the HPCDP, a visionary 10-year plan aimed at boosting economic diversification, industrialization, infrastructure, and private sector expansion. Its goal is to shift Kenya’s economy from low-productivity sectors to innovative, high-value industries.
: Kenya launches a $20M Holistic Productive Capacities Programme with UNCTAD to drive economic growth, boost diversification, industrialization, and private sector empowerment.
By Charles Wachira
Kenya held consultations with key development partners on October 3, 2024, to discuss the implementation of its ambitious Holistic Productive Capacities Development Programme (HPCDP), designed by the United Nations Conference on Trade and Development (UNCTAD).
This initiative aims to reshape Kenya’s economic landscape and pave the way for long-term sustainable growth.
Prime Cabinet Secretary Musalia Mudavadi, along with other senior government officials, led discussions with donors, UN representatives, the private sector, and key stakeholders.
The dialogue opened a new chapter in Kenya’s drive toward economic transformation.
“This programme is a turning point for Kenya’s future,” remarked Paul Akiwumi, UNCTAD’s Director for Africa, Least Developed Countries, and Special Programmes.
“It’s about laying the groundwork for a stronger economy by empowering people, businesses, and institutions to innovate, compete, and thrive.”
A New Economic Paradigm With Kenya’s past commodity-driven growth models proving insufficient to ensure inclusive and sustainable development, the HPCDP comes at a critical time.
Despite achieving growth rates exceeding 5% over the 15 years leading up to the COVID-19 pandemic, the country continues to face challenges, with poverty and economic vulnerability still widespread. Kenya’s Vision 2030 hinges on bridging the country’s productive capacities gap.
The consultations focused on how this programme will address core issues, such as underdeveloped industrialization and vulnerability to economic shocks, that have held back poverty reduction and job creation.
The Holistic Productive Capacities Development Programme The HPCDP, a bold 10-year initiative set to launch in 2025, is designed to enhance economic diversification, industrialization, infrastructure, and private sector growth.
The programme aims to transform Kenya from an economy reliant on low-productivity sectors to one driven by innovation and high-value industries.
Five key pillars will drive the programme:
Economic diversification and value addition Infrastructure development and environmental sustainability ICT for digital transformation Private sector growth and empowerment Skills development and policy coordination Securing Funding and Strategic Focus The consultations aimed to secure $20 million in funding over the next decade to support these transformative goals.
Discussions centered on how Kenya can harness its strengths in agriculture, manufacturing, and technology while aligning with the African Continental Free Trade Area (AfCFTA) to enhance its global competitiveness.
The Role of the Private Sector At the heart of the HPCDP is private sector empowerment. The programme focuses on supporting micro, small, and medium-sized enterprises (MSMEs), improving the business environment, and attracting both domestic and foreign investment.
By leveraging Kenya’s rapid infrastructure developments in transport, logistics, and energy, the country aims to become a regional hub for manufacturing and value-added processing.
A Collaborative Effort UNCTAD’s expertise in trade, investment, and technology for sustainable development will be central to the success of this initiative. A high-level steering committee and technical task force will oversee the programme’s implementation, ensuring seamless coordination and effective execution.
Looking Forward The October 3, 2024, consultations mark a significant step forward in Kenya’s efforts to achieve its Vision 2030 goals and transform its economy into one that thrives on innovation and productivity. With robust international collaboration and a clear strategy, Kenya is positioning itself for a future of sustainable growth and prosperity.
About UNCTAD: The United Nations Conference on Trade and Development (UNCTAD) is committed to promoting inclusive and sustainable development through trade and investment. With a broad membership, it empowers countries to use trade for economic growth and development.
Keywords:Kenya economic growth: Holistic Productive Capacities Programme: UNCTAD partnership Kenya: Industrialization and diversification: Private sector empowerment Kenya
Politics
Kenya Presidential Term Extension: Samson Cherargei’s Controversial Bill Sparks Public Opposition and UDA Stance
Many Kenyans have expressed strong opposition to the bill, fearing it could undermine the country’s democratic principles.
:Senator Samson Cherargei, a key figure in the United Democratic Alliance (UDA) and a close ally of President Ruto, contends that the current five-year presidential term is inadequate for fully implementing a leader’s agenda, particularly given the electoral disputes that frequently disrupt governance stability.
By Charles Wachira
Senator Samson Cherargei of Kenya is proposing a bill, aimed at extending the presidential term from five to seven years and the idea has ignited controversy, with critics alleging it’s a ploy to prolong President William Ruto’s rule.
Cherargei, a member of the United Democratic Alliance (UDA) closely aligned with Ruto, argues that the current five-year term isn’t sufficient for presidents to effectively implement their agendas, especially considering electoral disputes that often delay governance stability.
“Seven years will provide ample time for a president to deliver on their manifesto,” Cherargei defended during the bill’s Senate reading. He emphasized that frequent elections disrupt long-term development projects crucial for national growth.
This isn’t Cherargei’s first attempt at such reforms.
Similar proposals were previously rejected by the public through the National Dialogue Committee co-led by Ruto and opposition leader Raila Odinga in 2023. Now reintroduced, the bill also seeks to extend terms for MPs and governors to seven years and introduces the role of a prime minister appointed by the president.
Francis Chege from the former ruling Jubilee Party views the bill as a maneuver to benefit the political elite rather than the public interest.
“These proposals favour the political class and not the people,” Chege criticized.Adding that the move is “a plot to extend Ruto’s rule,” saying that the government may be “testing the waters” through such proposals to gauge public reaction. “This is about power consolidation, not the people,” Chege added, echoing the views of many who see the proposal as a threat to democratic accountability.
In contrast, Eugene Otieno, a history teacher, supports the concept but advocates for a single seven-year term to reduce political motivations.
“A single term would make the presidency less about re-election and more about governance,” Otieno suggested, stressing the need for extensive public consultation on such constitutional changes.
. “A single term will make the presidency less attractive for those looking to stay in power for personal gain,” Otieno said. He believes that a one-term presidency could allow a leader to focus on governance without being distracted by re-election campaigns, but insists on thorough public consultations before any changes are made.
Many Kenyans have expressed strong opposition to the bill, fearing it could undermine the country’s democratic principles.
Social media platforms and local talk shows have seen an outpouring of criticism, with citizens arguing that extending terms would likely lead to complacency, weakened checks on government performance, and potentially a rollback of democratic gains achieved over the past two decades.
A common refrain among opponents is that Kenyan politicians are trying to “change the rules of the game” to suit their own interests once in power.
At the grassroots level, many Kenyans are also frustrated with the slow pace of governance, which they attribute more to political inefficiency and corruption than the length of the president’s term.
Extending the term to seven years is seen by some as a distraction from addressing pressing issues such as unemployment, inflation, and the high cost of living.
Political analysts like Carol Situma argue that the timing of the proposal is highly suspect, especially given the economic challenges Kenya is facing.
Situma calls it “a diversionary tactic” designed to shift public attention away from more pressing issues, such as rising public debt, ongoing disputes over privatization deals, and unfulfilled promises by the Ruto administration.
Overall, public sentiment reflects a deep skepticism of the bill. Many citizens view it as an unpopular attempt to manipulate the constitution for political gain, and the likelihood of widespread public protests or backlash is high if the proposal gains traction in Parliament. Moreover, the memory of Kenya’s long struggle for constitutional reform and democracy makes many wary of an
The timing and intent behind Cherargei’s bill have sparked skepticism among analysts.
When reached for comment, UDA officials remained inaccessible. However, in previous statements, the party has distanced itself from Cherargei’s proposals, asserting their commitment to the existing constitutional framework.
“The UDA respects differing opinions, but these views do not reflect our party’s stance or that of our leader, President William Ruto,” a UDA spokesperson clarified in response to earlier similar attempts by Cherargei.
As the bill undergoes committee scrutiny in the Senate, its fate hinges on public feedback and legislative debate, with significant implications for Kenya’s political landscape if passed.
What’s Ruto’s position?
President Ruto has so far remained officially non-committal on the bill However, through his party, the United Democratic Alliance (UDA), Ruto has distanced himself from previous attempts by Cherargei to amend the constitution for similar reasons.
In 2023, Cleophas Malala, then Secretary General of UDA, made it clear that the party did not endorse such proposals. Malala emphasized that any changes to the presidential term would require a referendum, adding that President Ruto was committed to upholding the current five-year term limit as enshrined in the constitution.
“The president remains focused on delivering his development agenda within the mandate given by the people of Kenya, and he has no intention of pushing for constitutional amendments to extend his term,” Malala said at the time, addressing concerns that Cherargei’s proposal might represent the party’s position.
While Ruto has not publicly commented on Cherargei’s latest bill, the official stance of the UDA suggests the president is wary of being associated with proposals that may be seen as attempts to prolong his rule. Ruto has previously emphasized his commitment to constitutionalism and respecting democratic institutions, which include adhering to the two-term limit for the presidency.
If the bill passes, it could create a political storm. Extending the presidential term might embolden Ruto’s critics, who could accuse him of trying to entrench himself in power.
It could also lead to widespread public opposition, similar to the backlash against earlier attempts at constitutional changes.
Additionally, the introduction of a prime ministerial position could reshape Kenya’s governance structure and centralize more power within the presidency, potentially heightening tensions between the executive and other political forces.
For now, the bill is seen as Cherargei’s initiative, but its progress will undoubtedly place Ruto in a delicate position. He may be forced to publicly clarify his position if pressure mounts, especially as public consultations and Senate debates unfold.
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What do experts say?
Experts have weighed in on Senator Cherargei’s proposal to extend the presidential term from five to seven years, and their views reflect a deep concern over the potential impact on Kenya’s democratic system.
Political analysts, constitutional scholars, and governance experts generally see the move as a threat to Kenya’s democratic principles and a shift toward consolidating power, rather than a genuine attempt to improve governance.
- Threat to Democratic Gains: Many experts argue that extending the presidential term would undermine the democratic progress Kenya has made since the introduction of the 2010 Constitution, which set clear limits on presidential power. Constitutional law expert Dr. Duncan Ojwang highlights that term limits are designed to prevent the concentration of power and ensure regular, peaceful transitions of authority. “Term limits are essential for democracy. Extending the presidential term sets a dangerous precedent that could erode Kenya’s democratic culture,” he explained. According to Ojwang, removing or altering these limits could encourage future leaders to manipulate the system in their favor.
- Power Consolidation Fears: Several analysts, including political scientist Dr. Peter Kagwanja, see Cherargei’s bill as a veiled attempt to consolidate power within the ruling party, potentially making it harder for opposition forces to compete in elections. Kagwanja argues that the introduction of a prime ministerial position in the bill could give the president more control over Parliament, which could weaken checks and balances in government. “The proposal, especially with the prime minister’s office, centralizes power within the executive, raising the risk of an autocratic system,” he stated.
- A Diversion from Real Issues: Some analysts, such as Carol Situma, view the proposal as a political distraction. Situma describes the timing of the bill as suspicious, given that Kenya is currently grappling with major economic challenges, including inflation and high public debt. “This is a diversionary tactic by the ruling party to shift attention away from the real issues affecting Kenyans,” Situma observed. She adds that instead of focusing on electoral reforms, the government should prioritize addressing urgent concerns like unemployment, poverty, and governance inefficiencies. “The conversation should be about delivery of services, not extending terms.”
- Governance Impact: Experts in governance, such as Professor Macharia Munene, believe that extending the term limit may not necessarily result in better governance or development outcomes. He points out that five years is a reasonable period for a president to lay the groundwork for major projects, and if progress is slow, it often reflects poor management rather than insufficient time. “It’s not the length of the term that determines success, but the effectiveness of leadership and implementation,” Munene said. He also raised concerns that longer terms could encourage complacency among elected officials, reducing the urgency to deliver on campaign promises.
- Political Instability Risks: Constitutional lawyer Dr. Linda Musumba warns that changing the presidential term limit could spark political instability and lead to protests, as it might be seen as undermining the will of the people. “Attempts to alter key constitutional provisions without broad public support could lead to a political crisis,” Musumba cautioned. She emphasized that the Kenyan public is highly sensitive to any moves that could be interpreted as power grabs, particularly given the history of contested elections and street protests.
- Public Participation and Referendum: Experts across the board agree that any attempt to amend the Constitution, especially regarding presidential terms, must involve extensive public participation and likely a referendum. Dr. Samuel Nyikal, a constitutional scholar, emphasized that constitutional amendments of this magnitude cannot be left to Parliament alone. “These are issues that directly affect the people, and they must have a say. A referendum would be the legitimate way to resolve such matters,” Nyikal stated, echoing sentiments expressed by many civil society groups and legal experts.
In summary, experts overwhelmingly caution against extending the presidential term, citing risks to democratic principles, political stability, and governance quality. They recommend that the government focus on addressing Kenya’s pressing socio-economic issues rather than pursuing controversial constitutional amendment
Keywords: Kenya presidential term extension:Samson Cherargei bill controversy:Ruto administration power consolidation:UDA stance on term limits:Kenyan public opposition to term extension
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