Kenya has experienced an overall economic slump since presidential candidate Raila Odinga filed a court petition disputing the Independent Electoral and Boundaries Commission (IEBC) Aug. 15 announcement of William Ruto as the president-elect. But hours after Kenya’s supreme court upheld William Ruto’s presidential win, the financial markets are showing signs of recovery.
The Nairobi Securities Exchange (NSE) gained $357 million—the highest in three weeks. Market capitalization rose to $18.2 billion while equity turnover jumped by 70% to $3.7 million. But there will be no honeymoon phase for Ruto as he inherits a troubled economy.
Citizens continue to suffer through economic turmoil that has seen the loss of livelihoods. Investors are keen to witness the fulfillment of Ruto’s promise to fight corruption and repay the huge public debt which has seen treasury raise taxes and introduce new levies—an IMF recommendation. The technology sector is also looking to see how Ruto will fulfill campaign promises of making Kenya a tech powerhouse, and converting east Africa’s biggest economy from agriculture-based to tech-based.
Quartz Africa reports that the wage bill eats up 50% of all taxes collected and only goes into the hands of 2% of the country’s population. Inflation hit 8.3% in July, and Kenyans continue to suffer through rising food prices, a plunging currency, and mass unemployment. More than three-quarters of Kenya’s 53 million people are aged under 35, yet the youth unemployment rate is 39%.
Ruto’s government is inheriting public debt of %80billion which keeps snowballing due to corruption. A huge part of borrowed public funds ends up in the pockets of politicians and government officials with outgoing president Uhuru Kenyatta once estimating that corruption is responsible for the loss of $20 million from government coffers every day.
Meanwhile, Start Network, innovators in humanitarian financing and rapid response to crisis efforts in five continents, released £300,000 support in August 2022 prior to predicted post-election tensions in Kenya. This anticipatory response is continuing to support fast and effective assistance to those that may be directly affected by friction arising from the contested general election.
