The crisis that erupted after last month's disputed election in Kenya has spread gloom over the economy of a country which is known as one of Africa's most prosperous and tourist-friendly states, as well as that of its neighboring nations.
Officials said Kenya has suffered up to one billion U.S. dollars in losses due to the clashes following President Mwai Kibaki's disputed re-election. The violence has killed over 600 people.
Tourism is among the most severely hit sectors. Bed occupancy has dropped to 20 percent as news coverage on rioting and looting has caused many of the holiday-makers to give up their trips to Kenya.
Kenya's tourism industry made an estimated 60 billion Kenyan shillings (916.3 million dollars) last year but analysts say the figure for 2008 is feared to be much lower.
"If tourism goes down, the economy will go down big time and the multiplier effect will hit everyone," said Duncan Muriuki, chairman of the Kenya Association of Tour Operators.
Countries such as the United States and Britain have warned their citizens to cancel non-essential trips to the African country.
The crisis has driven up prices of staple foods such as maize flour and some vegetables. It has also affected the financial markets and beaten investors' confidence.
As gloom spreads across a range of sectors, analysts worried that Kenya might fall short of its previous projections for seven to eight percent economic growth for this year.
The crisis in what is the regional transit point has also cast a shadow on Kenya's neighbors. According to the World Bank, a quarter of the gross domestic product of Uganda and Rwanda, and a third of Burundi's pass through Kenya.
In the meantime, U.N. agencies including the World Food Program and the United Nations Children's Fund have long used Kenya as an operational hub due to the country's traditional stability and proximity to some volatile African nations.
The unrest has affected not only these agencies' humanitarian operations in Kenya, but also some projects in other African countries as the logistics flow has been interrupted.
After the Dec. 27 polls, Kenyan President Kibaki claimed victory but opposition leader Raila Odinga quickly accused him of rigging the election.
In opposition strongholds in Nairobi and western areas of Kenya, allegations of fraud sparked days of rioting that quickly turned into deadly clashes between tribes. At least 600 people have died in post-election violence, and hundreds of thousands have been displaced.
As a major showdown loomed in Kenya Tuesday when newly elected lawmakers prepare to take up their seats in the 222-member parliament, former U.N. chief Kofi Annan is due in Nairobi later in the day for mediation.
Annan is expected to arrive here with several other influential African leaders in fresh efforts to mediate talks between the feuding parties.
In previous mediation efforts, African Union chief John Kufuor and other diplomats, including the U.S. top envoy for Africa Jendayi Frazer, have failed to bring the two sides together.
While the upcoming visit of Annan is aimed at rekindling hope, Kibaki's government has already played down the role of the former U.N. chief, saying it has not assented to Annan's arrival to mediate between it and the opposition Orange Democratic Movement.
Roads Minister John Michuki and Internal Security Minister George Saitoti insisted that President Kibaki won the election and had no business inviting mediators as the government was not an aggrieved party.
"We did not invite the former presidents and Ghanaian President John Kufuor. Even Kofi Annan has not been asked to come by us," said Michuki.
Source: Xinhua
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