Kenya: No Worries There, Mate

I only turn our attention to Kenya as I remain troubled by freaky memories of giving fire sale golf lessons to a strapped Kenyan ambassador who hoped that learning golf with his embarrassing entry level set of Mizuno clubs would aid in networking his way into the boozing echelons of G8 diplomats.

The impoverished pretender was hopeless at anything even remotely demanding a sober cerebellum's micro-management of hand-eye cooperation, but he never failed at springing for peanuts and two beers each at the hooker-rife Sheraton where we'd savor the highlights of our weekly routine of sneaking on to any given local course for however long it took to be spotted furrowing through the greens with scoliotic swings, only and always to be chased off the grounds by barking representatives of the local master race.

Before each lesson the ambassador's driver would pick me up in a CD tagged black stretch Mercedes and en route to hooking up with ambassador-man for yet another weekly raid I'd pump limo-boy (talking to the limo-boy was verbotten per explicit ambassadorial instruction) for the lo-down on the legation's upstairs/downstairs relations. "Just a matter of time", I thought. "Just a matter of time before the bows and arrows come out." All that was an amazing 20 years ago.

While Western media is having a revelous heyday publishing pictures of culturally hyper-regressing Kenyans armed with bows and arrows (these pictures have been picked up all across the occidental world), I turn to the metrics-men of the insurance industry to size up the lay of that quaking land - for it is often such plodding folk one can count on to deliver less dubiously indulgent and level-headed assessments on matters of reasonable import.

The excerpts below hardly do the complete South African Insurance Times & Investment News article justice so I'd recommend reading it in it's entirety for one of the better situational briefings around, imho.

• Kenya's post-election crisis has significantly damaged the domestic economy and Global Insight has downgraded its 2008 base-line forecast to 4% from a pre-crisis forecast of 6.1%, assuming a quick resolution is found.
  

• The tourism, agriculture, transportation, and communications sectors have been directly hit by the unrest, with knock-on affects rippling through the rest of the economy.
  

• Kenya's budget is also facing considerable pressure on a number of fronts as underlying budget assumptions are tested.
  

• Tribalism, political disharmony, land disputes, and pervasive poverty all have a leading part to play in the current turmoil.
  

• Mediation talks have so far failed and a new team of African leaders, led by former UN secretary-general Kofi Annan, has taken over the negotiations.
  

• Possible political solutions include, among others, the formation of an interim unity government with a view to paving the way for a constitutional change, and for President Kibaki to step down and resign himself to a re-run of the election.
  

• Nevertheless, there are key fundamental developments that lend a mitigating factor to the situation and point to a limited long-term impact on the economy. [*]

[*]Kenya's role as the regional hub and its geopolitical importance all bolster long-term growth. Key infrastructural developments, especially within trade and transportation infrastructure, are of categorical regional importance and the fundamental drivers that have led to the 2004-2007 economic revival remain.

The export sectors are well-grounded and developed enough to take advantage of a more competitive exchange rate, and the unique tourism sector remains strong enough to recover.

It is also worthy to note that the economy has grown and pro-business policies have been passed (albeit delayed), despite competition in a split parliament and a strong no vote on the government’s constitutional propositions.

Kenya is at a turning point that will force the country to take a long, hard look inwards.

There is still optimism that a solution will be found in enough time to halt a severe hit to the economy, but even if such a solution is delayed, there is enough strength and opportunity in Kenya's fundamental drivers to support a return to the path of recovery in the long term.