Is Kenya Losing Its Powerhouse Status in East Africa?
As little as five years ago, Kenya was the undisputed powerhouse of the East African region. And, while the government insists that position in unassailable, it looks like a transition of power could be on the cards.
Some experts from within the country even suggest there’s a deliberate strategy from Kenya’s neighbours to isolate the nation. Others simply point to the rapid development surrounding Kenya – particularly in Rwanda, Ethiopia and more recently Tanzania. Meanwhile, Uganda’s position in the region on seems to grow.
The Uganda pipeline deal
Talk of Kenya losing its place of influence in East Africa gained new motion after an oil pipeline deal with Uganda fell apart. The project eventually went to Tanzania and now South Sudan even appears hesitant to build a pipeline with Kenya. Suddenly, the region’s powerhouse, who all its neighbours wanted a piece of, looks set to go it alone in transporting crude oil – and not by choice.
The failed deal is a major symbolic loss for Kenya, no doubt. Worse still, it highlights a growing list of factors that put the country’s position in the region under threat.
The rise of Tanzania
Perhaps the most worrying of these is the rise of Tanzania. Not only are we talking about the country that beat Kenya to the Uganda pipeline deal, but one that’s gaining a reputation with foreign investors and the international community alike.
Despite the country still struggling with widespread poverty, economic growth in the country is steadily rising. Recent discoveries of vast oil and natural gas reserves have captured the attention of neighbouring countries and foreign investors. While the Tanzania’s new president, John Magufuli, is being celebrated for his hard stance against corruption and officials who neglect their duties.
Kenya, on the other hand, is famed for rampant corruption and rumours of economic decline have been circulating for some time now.
Bilateral ties with Uganda
Aside from the financial blow of losing out on the Uganda pipeline, there are question marks over what this means for bilateral ties between Kenya and its neighbour. The nature of how Tanzania emerged as a late winner of the contract put an awkward strain on one of East Africa’s strongest relationships. The problem for Kenya, at this stage, is the deal doesn’t only compromise its relations with Uganda, but also the emerging Tanzania.
The border dispute
Kenya has another noisy neighbour to think about in Somalia. A long-running border dispute between the two countries will now go to the UN high court to be settled once and for all. It’s not just a political battle taking place, though, because the 100,000 square kilometre stretch of maritime territory is believed to have oil and natural gas reserves.
If Kenya loses its case in the UN courts then it’s an economic loss as much as a territorial one. It would also signal another public defeat for Kenya at the hands of one of its neighbours.
While Kenya still remains the economic powerhouse in East Africa, stability remains a challenge for the country. The border it shares with Somalia opens major security concerns, which not only poses a threat to public safety but also puts off investors.
The economic gap between Kenya and its neighbours is closing, too. The rise of Tanzania comes after Rwanda and Ethiopia’s climb to economic stability. Foreign investment in Africa is increasing all the time but Kenya isn’t the obvious choice for investors anymore.
Kenya’s growth is stalling while its neighbours are steadily rising. It’s not only a question of security that puts Kenya in a fragile position. Corruption has become such a plague the country’s economy has been pushed to breaking point. And then you have the infrastructural concerns that refuse to go away – like Nairobi’s continued struggle with supplying clean water to its 3 million residents.
The fact is Kenya’s economic position hasn’t looked so questionable since the EAC bloc was established. That shrinking economic lead over its neighbours appears to be all Kenya has got right now – and it’s fading away.