Kenya Drought Impact, Graft May Force Runoff Vote, Teneo Says

  • Inflation rate rose to 11.5% in April, highest in five years
  • Nation is among 30 countries considered world’s most corrupt

Kenyan President Uhuru Kenyatta may face a runoff vote after elections in August because spiraling food inflation and an inadequate response to corruption are eroding support for his party, according to Teneo Intelligence.

Kenyatta will compete against a unified opposition and independent candidates who will draw votes away from his candidacy, increasing the likelihood for a second-round vote, Ahmed Salim, a Dubai-based analyst at the risk consultancy, said in an emailed note.

“Although opinion polls signal that Kenyatta remains the favorite, his re-election will likely be much more challenging than in 2013,” Salim said.

Kenyatta’s main opponent in the election will be former Prime Minister Raila Odinga, who heads a coalition of five opposition parties. In 2013, Kenyatta won the presidential vote with 50.07 percent of the vote, compared with 43.3 percent for Odinga, who failed on two other previous attempts to win the presidency.

Kenya’s inflation rate jumped to the highest in five years in April, climbing 11.5 percent as a drought crimped rain-fed agriculture and boosted food prices by a fifth. The country dropped six places in Transparency International’s Corruption Perceptions Index last year, ranking Kenya among 30 countries perceived as the world’s most corrupt.

Link to Bloomberg Intelligence report on Kenyan inflation

“The economy will feature highly among the electorate this year, more so than in the previous election,” Salim said. “This is particularly true considering the prices of maize, sugar and vegetables have all gone up, all related to the rainfall shortage.”

Kenya is scheduled to hold elections on Aug. 8. The results must be published within seven days and any runoff should be held within 30 days of the initial election, according to the state-run Kenya Law Reform Commission’s website.

    Before it's here, it's on the Bloomberg Terminal.