AN EXAMINATION OF HOW THE 2024 POLITICAL UNREST HAS AFFECTED KENYA’S ECONOMIC STABILITY

CHAPTER ONE INTRODUCTION 1.1 Background of the Study Kenya, widely regarded as the economic hub of East Africa, has historically faced numerous political and economic challenges. Among these, the political unrest that erupted in 2024 stands out as one of the country’s most significant crises in recent times. Kenya’s political environment has been shaped by its colonial legacy, struggles following independence, and recurring episodes of electoral violence. Since gaining independence from Britain in 1963, the country has experienced periods of both stability and turmoil. One of the most severe instances was the 2007–2008 post-election violence, which led to the deaths of over 1,000 people and the displacement of hundreds of thousands (Human Rights Watch, 2018). This event exposed the deep-rooted ethnic divisions and the fragile nature of Kenya’s political system. The 2024 unrest can be seen as a continuation of this long-standing pattern of instability. Sparked by disputes surrounding electoral procedures and governance, the unrest has been characterized by widespread protests, clashes between opposition supporters and security forces, and a breakdown of order in several parts of the country. These developments have significantly disrupted everyday life and have added further strain to Kenya’s already fragile political framework. However, Kenya’s economy continues to face serious challenges such as high poverty levels, income inequality, and a heavy reliance on foreign aid. These issues were further exacerbated by the COVID-19 pandemic, which caused a severe economic slowdown and increased national debt levels (International Monetary Fund, 2021). As the country was beginning to recover from the pandemic’s economic effects, the 2024 political unrest emerged as a new threat to its financial stability. Many scholarly works have emphasized the link between political stability and economic performance. Evidence strongly suggests that political instability can hinder economic growth and development (Alesina et al., 1996). The 2024 unrest in Kenya has already shown both immediate and potentially long-term impacts on various sectors of the economy. In agriculture, the unrest disrupted farming activities, supply chains, and market access, leading to food shortages, rising prices, and worsened food insecurity (FAO, 2024). The tourism industry, which is highly sensitive to perceptions of security, has also suffered, with cancellations by international tourists and declining revenues for local businesses (UNWTO, 2024). Moreover, there has been a significant outflow of capital, as both local and international investors pull out due to fears of economic instability. This has led to the depreciation of the Kenyan shilling, increased inflation, and a rising cost of living for the average citizen (Central Bank of Kenya, 2024). Adding to the economic pressure are the sanctions imposed by international bodies in response to alleged human rights violations during the unrest. These sanctions have further strained the country’s financial resources. Given the far-reaching effects of the 2024 political crisis, it is critical to examine its impact on Kenya’s overall economic stability. 1.2 Statement of the Problem The 2024 political unrest in Kenya has raised serious concerns about its impact on the country’s economic well-being. Political instability often disrupts economic activities, reduces investor confidence, slows development, and increases poverty levels (Alesina et al., 2016). In Kenya’s case, the unrest has manifested through widespread protests, disturbances in essential sectors like agriculture and tourism, and disruptions to key trade routes—each vital to maintaining economic integrity. Additionally, the crisis has led to a decline in foreign direct investment (FDI) and has put significant strain on the national budget, as the government has had to divert resources to manage the situation (World Bank, 2024). The enforcement of economic sanctions by various international organizations in response to human rights violations has further complicated Kenya’s attempts to maintain economic stability. These developments highlight the urgent need for this study, which investigates the effect of the 2024 political unrest on Kenya’s economic stability. 1.3 Objectives of the Study The main goal of this study is to assess the impact of the 2024 political unrest on the economic stability of Kenya. The specific objectives are to: i. Examine the effects of the 2024 political unrest on Kenya’s employment levels. ii. Assess the impact of the unrest on Kenya’s trade balance and its international trade relations. iii. Explore the role of government policies in alleviating the economic consequences of the unrest. iv. Offer practical recommendations to enhance Kenya’s economic resilience in the face of future political disruptions. 1.4 Research Questions This study will be guided by the following research questions: i. How has the 2024 political unrest affected employment levels in Kenya? ii. What impact has the unrest had on Kenya’s trade balance and international trade relationships? iii. How effective have government policies been in addressing the economic fallout from the political unrest? iv. What recommendations can be made to strengthen Kenya’s economic resilience against future political instability? 1.5 Significance of the Study This study holds significant relevance for policymakers and government authorities, as it offers critical insights into how political unrest affects economic performance. By identifying specific sectors impacted by instability, the study can help in crafting more targeted and effective policies to minimize future economic disruptions. Additionally, the study’s findings can contribute to strategies that aim to improve Kenya’s economic resilience, enabling it to better withstand similar challenges in the future. For academics and researchers, this study will enrich the existing body of literature, provide valuable reference materials for future inquiries, and serve as a resource for students and scholars interested in political economy and development studies. 1.6 Scope of the Study This research is focused on examining the effects of the 2024 political unrest on Kenya’s economic stability. It will empirically investigate how the unrest has influenced employment levels, affected the trade balance and international relations, evaluated the effectiveness of government responses, and suggested strategies for enhancing economic resilience in the face of political turmoil. 1.7 Limitations of the Study As with any research, this study encountered a few limitations. Time Constraints: The researcher had to balance the study with other academic obligations, such as attending lectures and completing coursework, which limited the amount of time available for research. Financial Constraints: The research process involved financial demands such as printing, data collection, and accessing reference materials, which posed a challenge. Limited Access to Materials: There was difficulty in sourcing adequate and up-to-date literature on the specific topic due to its recent nature, which posed a limitation to the depth of the study. 1.8 Definition of Terms Political Unrest: Refers to a situation marked by widespread public discontent, including protests, strikes, and sometimes violent confrontations, often driven by issues like election disputes or governance failures. In this study, it specifically refers to the events that unfolded in Kenya in 2024. Economic Stability: Describes a state where an economy experiences steady growth, controlled inflation, low unemployment, and predictable market conditions, allowing for sustainable development. Gross Domestic Product (GDP): The total value of all goods and services produced within a country over a given time. It is a key indicator of a nation’s economic health and growth. Foreign Direct Investment (FDI): Refers to investments made by individuals, businesses, or governments from one country into assets or companies located in another country, often involving significant ownership or control. Investor Confidence: Represents the level of trust investors have in the financial and political stability of a country. High confidence typically encourages investment, while low confidence can lead to capital flight. Inflation: The rate at which prices for goods and services increase, resulting in a decrease in the purchasing power of money. It is influenced by policy decisions, supply-demand dynamics, and political factors. Trade Balance: The difference between a country’s exports and imports. A surplus occurs when exports exceed imports, while a deficit arises when imports are greater than exports.