2023: Year opposition street demos shook confidence of local and foreign investors

Azimio protestors lit a fire in the road along Isebania Migori Kisii highway on March 20, 2023, during their demonstration against the high cost of living in Migori Town. [Caleb Kingwara, Standard]

Selling Kenya as the best investment destination in the region might have been President William Ruto’s toughest task this year.

This was on the back of a tough operating environment prompted by political unrest as the opposition pushed for lowering the spiralling cost of living and made a case against the outcome of the August 2022 presidential polls.

As President Ruto disrupted the usual chaotic Nairobi traffic with his entourage moving from one business event to another, the opposition was rallying its supporters against his administration.

Just months into his reign after last year’s contested election, the President had made several policy decisions that the opposition and even a section of his supporters insisted were at odds with his campaign pledges. 

“There is no other Kenyan president but me. What I cannot do is let a small group of individuals interfere with my work of serving Kenyans. I will not take part in that,” said President Ruto on January 27 at Nairobi’s Shauri Moyo neighbourhood to break ground for an affordable housing project, one of the agendas under his Bottom-up Economic Transformation Economic Agenda(BETA). 

What followed was a series of business summits as the opposition under the Azimio coalition and their supporters unleashed mayhem on the streets of the capital and other major towns around the country. 

And in every business event, President Ruto attended during the protracted politically charged period, he never failed to remind the business community how free and fair the August 2022 elections were.

The international community soon joined the fray in calling for an end to the escalating hostilities. 

“Kenya held what many analysts and commentators say was the freest, fairest and most credible election in Kenyan history,” said the United States Ambassador to Kenya Meg Whitman in March during the American Chamber of Commerce(Amcham-Kenya) business summit held at a Nairobi hotel.

President Ruto while closing the summit also referenced the August 2022 presidential polls and the Supreme Court ruling that threw out the opposition’s case contesting the outcome.

The Raila Odinga-led opposition coalition would intensify the protests whenever Kenya was hosting a business delegation of some sort, such as the Amcham event.

The President in his closing remarks promised investors that a national tax policy would soon be in place.

This is as Raila’s supporters engaged the police in a cat-and-mouse game on the busy Mombasa Road.

President Ruto had just come from Berlin where he sold Kenya as the best investment destination in Africa, saying over 90 per cent of electricity supply comes from renewable energy sources, particularly geothermal.

While his mission was to attract as many foreign investors as possible, the noise from the opposition was deafening his pitch.

“As friends and partners to Kenya, we are deeply concerned by the recent unrest and violence as well as the destruction of places of worship and private property. It is also damaging economic activity at a time of significant financial challenges,” read a statement from High Commissions and Embassies, including the United States released the same day when the Amcham business summit was wrapping up.

The statement was also co-signed by the embassies of Norway, Australia, the United Kingdom, Canada, Denmark, The Netherlands and Sweden.

Just a week before the Amcham business summit, President Ruto while addressing investors and business leaders at the Nairobi Securities Exchange (NSE), had vowed to do everything he could to ensure a sound business environment in the country.

He vowed that his administration would decisively combat impunity and lawlessness.

“There is no reason for anyone to stand in the way of free enterprise, disrupt business, sabotage economic activity or work as economic terrorists for personal selfish interest,” he said. 

But by July, the lawlessness had not subsided and businesses had begun to feel the heat of the disruptions in their operations. 

An Azimio la Umoja supporter is roughed up by anti-riot police officers as the coalition staged nationwide protests against the high cost of living. [Collins Oduor, Standard]

Kenya Association of Manufacturers (KAM), a business lobby for manufacturers, claimed Sh2.8 billion in daily losses due to the disruptions caused by the protests that made logistics a challenge for those producing fast-moving consumer goods. 

KAM chairperson Rajan Shah at a press conference in Nairobi said the protests had created fear and uncertainty, which has made it difficult for their staff to report to work. 

He said considering the manufacturing sector’s contribution to the economy stands at about Sh1 trillion, according to the state’s data bureau, the economy could not stand to bleed such a colossal amount daily.  

“We are in a lose-lose situation. There is no winner in such a scenario,” he said. 

Mr Shah said the disruptions had the potential to increase the cost of living by altering the supply logistics of both finished goods and raw materials. 

He noted delays already among KAM members as he expressed fears of demand erosion.  

Mr Shah said the prevailing business environment did not help the government’s shared goal with manufacturers to increase the sector’s contribution to the country’s Gross Domestic Product (GDP) to 20 per cent by 2030. Current contribution stands at 7.2 per cent. 

“This may not be achievable with the current trend,” he said. 

It took the establishment of the National Dialogue Committee, which roped in representatives from both the Kenya Kwanza administration and the opposition movement, to stop the madness and restore confidence in the business community.