Economic Impact of Uhuru Kenyatta and Raila Odinga Handshake in Kenya

Kenyans went into a hotly contested election in August 2017. Theย  Independent Electoral and Boundaries Commission declared the incumbent, President Uhuru Kenyatta, as the winner of the elections. Raila Odinga, the charismatic leader of the opposition party, came second. Odinga claimed foul play in the elections and refused to accept the results.

Political Tensions in Kenya

What followed was a series of protests in the oppositionโ€™s strongholds, with Raila Odinga remaining adamant that he won the elections. As a result, the countryโ€™s political temperature was high, subsequently leading to a significant negative impact on the countryโ€™s overall economy. The situation was exacerbated when Odinga swore himself in as the presidentโ€“a move considered by some pundits as equivalent to treason.

Opposition leader Raila Odinga holds a bible aloft after swearing an oath during a mock โ€œswearing-inโ€ ceremony at Uhuru Park in downtown Nairobi, Kenya Tuesday, Jan. 30, 2018. Odinga was sworn-in as โ€œthe peopleโ€™s presidentโ€ during a mock โ€œinaugurationโ€, in protest of President Uhuru Kenyattaโ€™s new term following the divisive 2017 election, and despite the governmentโ€™s warning that the event would be considered treason. (AP Photo/Ben Curtis)

The swearing in of Raila Odinga as โ€˜The Peopleโ€™s Presidentโ€™, few months after the official swearing in of Uhuru Kenya as the President, threw the country into limbo. With Odinga enjoying support from a significant proportion of the population, the divisions across party and ethnic lines were self-destructing.

Falling Economy

Most businesses considered certain parts of the country as high-risk areas to commit their investments. Some foreign investors took leave waiting for the outcome of the unfolding events. The countryโ€™s economy was on a downhill stretch. With the countryโ€™s history of the 2007-2008 post-election violence, the investors took no chances.

The Truce

On March 9, 2018, a new dawn in the countryโ€™s future was birthed on the steps of Harambee House in the Nationโ€™s capital, Nairobi. Raila Odinga and Uhuru Kenyatta shook hands as a sign of reconciliation after hours of talks at the Presidentโ€™s office. Ultimately, the leaders exhibited a show of unity by shaking their hands and addressing the nation together.

The handshake between Raila Odinga and Uhuru Kenyatta.
The handshake between Raila Odinga and Uhuru Kenyatta Photo credit: REUTERS / THOMAS MUKOYA โ€“

Kenya being an important East and Central Africaโ€™s economic hub, this was good news for both Kenyans and non-Kenyans in the region. In addition, the handshake was a good sign for foreign investors from Europe, Asia, and the Americas.

Rebounding Economy

Since March 2018, Kenya has enjoyed tranquility and stability, creating a favourable environment for investors and local businesses. Once again, the prospects of the countryโ€™s growing economy are high. As of April 2018, just a month after the truce, the Kenyan shilling hit a two-year high. With foreign investorsโ€™ confidence restored, there was a rise in inflows.

The countryโ€™s economy advanced by 6 percent year-on-year in the third quarter of 2018. According to the World Bank, Kenyaโ€™s economy is projected to grow by 5.8 percent in 2019. Furthermore, the IMF has ranked Kenya as among the fastest-growing economies in 2019, with a projected growth rate of 3.8 percent. The upward trajectory in the countryโ€™s economy is a result of the โ€˜handshakeโ€™ between Uhuru Kenyatta and Raila Odinga.

The handshake is a good example to other African leaders on how to unite a country.

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