Kenya prime minister optimistic about economy
By Andrew Stern
CHICAGO, May 21 (Reuters) - Kenya's economic growth will pick up again after slowing markedly in 2008, its prime minister said on Thursday, adding that the political violence that swept the African nation a year ago was an aberration.
Kenya's economy, largely dependent on agriculture and tourism, had expanded rapidly until last year, when growth shrunk to 1.7 percent from 7.1 percent a year earlier, due to the violence, commodity weakness and the global recession.
Speaking to a Chicago business group, Prime Minister Raila Odinga predicted economic growth would rise to 3 percent this year and expand by 5 to 10 percent in subsequent years.
"For this to happen, public funding is not enough," Odinga said, outlining Kenya's coalition government's strategy to enlist private companies and foreign aid donors to help expand East Africa's largest economy.
Kenya's central bank on Thursday cut its lending rate by 25 basis points to 8 percent to spur growth, in spite of a 28 percent inflation rate.
Analysts have forecast, on average, 2.5 percent growth for Kenya's $35 billion economy in 2009, down from an earlier prediction of 4.1 percent.
Odinga predicted U.S.-Kenyan trade would eventually get a lift from the launch on June 3 of direct flights between Nairobi and Atlanta by Delta Air Lines Inc (DAL.N), which is a partner of Kenya Airways.
He acknowledged corruption plagued the country but promised a "non-tolerant regime" that will crack down on bribery at high levels and lift living standards for police and other functionaries to head off endemic petty corruption.
Public disillusionment with Kenya's government is high, and U.S. officials have grown concerned about squabbling in the coalition, formed in April 2008 to stop ethnic clashes that killed 1,300 people and forced 300,000 to flee their homes.
The crisis was sparked by incumbent President Mwai Kibaki's disputed re-election in a Dec. 27, 2007 vote. Odinga, the main opposition leader, challenged the results, saying the poll had been rigged.
Odinga eventually agreed to share power with Kibaki.
"Our coalition is working as best as it can," Odinga told reporters, adding that governing in a coalition was new to Africans.
"The disturbances of last year had to do with the rigging of elections. That is not the Kenyan character. Kenyans are a very peace-loving people. I can assure people that Kenya is safe to come to, definitely. You're safer in Nairobi than you are in Chicago," he said. (Editing by Michael Conlon and Paul Simao)
CHICAGO, May 21 (Reuters) - Kenya's economic growth will pick up again after slowing markedly in 2008, its prime minister said on Thursday, adding that the political violence that swept the African nation a year ago was an aberration.
Kenya's economy, largely dependent on agriculture and tourism, had expanded rapidly until last year, when growth shrunk to 1.7 percent from 7.1 percent a year earlier, due to the violence, commodity weakness and the global recession.
Speaking to a Chicago business group, Prime Minister Raila Odinga predicted economic growth would rise to 3 percent this year and expand by 5 to 10 percent in subsequent years.
"For this to happen, public funding is not enough," Odinga said, outlining Kenya's coalition government's strategy to enlist private companies and foreign aid donors to help expand East Africa's largest economy.
Kenya's central bank on Thursday cut its lending rate by 25 basis points to 8 percent to spur growth, in spite of a 28 percent inflation rate.
Analysts have forecast, on average, 2.5 percent growth for Kenya's $35 billion economy in 2009, down from an earlier prediction of 4.1 percent.
Odinga predicted U.S.-Kenyan trade would eventually get a lift from the launch on June 3 of direct flights between Nairobi and Atlanta by Delta Air Lines Inc (DAL.N), which is a partner of Kenya Airways.
He acknowledged corruption plagued the country but promised a "non-tolerant regime" that will crack down on bribery at high levels and lift living standards for police and other functionaries to head off endemic petty corruption.
Public disillusionment with Kenya's government is high, and U.S. officials have grown concerned about squabbling in the coalition, formed in April 2008 to stop ethnic clashes that killed 1,300 people and forced 300,000 to flee their homes.
The crisis was sparked by incumbent President Mwai Kibaki's disputed re-election in a Dec. 27, 2007 vote. Odinga, the main opposition leader, challenged the results, saying the poll had been rigged.
Odinga eventually agreed to share power with Kibaki.
"Our coalition is working as best as it can," Odinga told reporters, adding that governing in a coalition was new to Africans.
"The disturbances of last year had to do with the rigging of elections. That is not the Kenyan character. Kenyans are a very peace-loving people. I can assure people that Kenya is safe to come to, definitely. You're safer in Nairobi than you are in Chicago," he said. (Editing by Michael Conlon and Paul Simao)
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