Kenya | GPN

Kenya
Kenya entered the 21st Century in the middle of what was arguably the worst economic crisis since the country gained independence in 1963. The GDP growth rate has declined continuously from a peak of about 6.5% per year during the decade 1963 - 1972, to less than 4% per year in the following decade, to, more recently, only about 1.5% per year during the 1990’s. GDP actually fell about 0.3% in year 2000. Current estimates suggest that the growth rate was about 1.2% in 2001. In year 2002 it is estimated that the economy grew at a rate of 0.8%.

The poor economic performance was due to several factors, including prolonged drought that lead to power rationing, inadequate infrastructure, and low agricultural productivity. Poor governance and corruption have also had an important negative impact on growth. The twin problems now facing the Kenyan economy are poverty and a high level of unemployment. HIV/Aids, which now takes 710 lives per day, has further undermined productivity. The new National Rainbow Coalition (NARC) government has begun to confront these problems by forming a Cabinet committee on AIDS and asking corrupt judges to resign The NARC’s biggest challenge is keeping its’ promise to create 500,000 new jobs. By June 2003, only 70,000 jobs have been created. However, between January - March 2003 there has been massive Industrial Unrest in the EPZ zones. These were occasioned by poor working conditions and lack of Trade Union representation because of Government Exemptions. The NARC Government has authorized recruitment of members into trade unions. The Government has therefore revoked the exemption against unionisation and, as a result, union membership is increasing. In Kenya the wealthiest 10% of the population receive 47% of the income while the poorest 20% receive 3.4% of the GDP. The Gini results are supported by estimates of absolute poverty, under $1 per day, affecting 60% of the population. In an effort to address poverty, the government has reduced taxes on the poor. Privatization has been suspended until a legal framework can be put in place.

To read a detailed labor market analysis for Kenya, download one of the following:
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Source:
COTU(K) —
Congress of Trade Unions, Kenya
P.O. Box 13000
Nairobi, Kenya
Tel: 761.375/6/7
Fax: 762.695

Data updated: October 28, 2003.

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