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Democracy and Governance in Kenya
Kenya is experiencing a unique historical moment. On December 27,
2002, Kenyan voters elected their first new president in 24 years. The new government has already
made a clear break from the past by its policy actions, including the introduction of key legislation to
address corruption and improve governance, support for free universal primary education, and working to
accelerate the constitutional review process. To this end, the Government of Kenya (GOK) has
completed financing agreements with the World Bank and the International Monetary Fund (IMF), which
are encouraged by the government’s commitment to the reform process. Yet, there is much to do. The
GOK and its development partners (including USAID) are undertaking an ambitious agenda of reform,
with a focus on the implementation of key measures to fight corruption and promote good governance,
encourage economic recovery, and combat HIV/AIDS.
Though frustrated by a history of poor policy decisions and lack of foreign direct investment, Kenya still
has the largest and most diversified economy and the most developed infrastructure in the East Africa
region. Kenya’s gross domestic product grew at an annual average rate of 2.2% in the past decade---not
sufficient to keep up with population growth. The World Bank, however, estimates that the country could
grow by more than 6% per annum with the implementation of a serious reform program as outlined in the
GOK’s Economic Recovery Strategy. Kenya’s external debt has been falling and is about $5.5 billion.
Sound monetary policy has produced low inflation and a stable exchange rate. Kenya has also become a
leader in the race to benefit from the U.S. African Growth and Opportunity Act (AGOA), and its garment
industry is enjoying spectacular recovery. Factors such as efficiently run export processing zones, good
air and sea transport links to Asia and the United States, and a skilled workforce are important attributes
in attracting other businesses as the investment climate improves under the new government.
Besides needing to make progress on the goals of democratic transition and economic recovery, the
country faces a number of additional challenges in the social sectors. The 2003 Demographic and Health
Survey (DHS) shows that fertility increased over the past five years. This reverses a decade of
outstanding progress in family planning. The Total Fertility Rate (TFR) in 2000-2002 was 4.9 children per
woman, up from 4.7 in 1995-1997. The DHS also shows that after decades of improvement, child
mortality rates increased by 28% from the late 1980s to the present. Of 1,000 births in Kenya, 114
children died before age five during the 1998-2002 period, up from 89 deaths per 1,000 births over the
1984-1988 period. The Kenyan educational system is also facing significant challenges, especially the
high direct costs of schooling that have kept a significant proportion of the poor away from school.
Another challenge is the low level of internal efficiency, as evidenced by the high drop out rate (5%-6%)
and repetition rates (15%-16%) at primary levels. There are also regional and gender disparities, with the
arid areas being the hardest hit. The new government, however, has introduced free primary education
and substantially revised the educational curricula.
(Excerpted from the 2005 Congressional Budget Justification for Kenya)
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