Optimism among Kenyan companies has declined in the run-up to elections due in March 2013 amid concern about the prospect of ethnic tensions, according to a survey by Ipsos Synovate and Kenya Private Sector Alliance.
The Business Leaders Confidence Index, based on a survey of 145 executives, declined to 53.8 in August from 68.6 when the previous poll was conducted in February 2010, Maggie Ireri, managing director of Ipsos Synovate Kenya, told reporters today in Nairobi, the capital.
Investors usually grow less confident before elections in East Africa’s biggest economy, a period when tensions between tribes escalate into power struggles, Patrick Obath, chairman of KEPSA, the acronym for the alliance representing more than 200 Kenyan-based companies, said at the same event.
Allegations of vote-rigging at the last presidential elections in December 2007 sparked ethnic clashes over two months that left 1,100 people dead and stifled economic growth.
Recent clashes between farmers and pastoralists in northeastern and southeastern Kenya are adding to negative perceptions about the country, Obath said. The attacks could be politically driven as the country redefines constituency boundaries, according to the United Nations.
About 100 people have died in the fighting in the Tana River delta over the past month, including three people in the most recent attack today, and the area is now under a dusk-to-dawn curfew imposed by President Mwai Kibaki. Intercommunal violence killed at least 16 people in the northeastern communities of Wajir and Mandera in August.