Violence closing Kenya for business

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Doug Krizner:
The violence and political unrest in Kenya closed the country’s stock market yesterday. They’re trading today, but the exchange is ready to close at a moment’s notice. The World Bank says the turmoil is rattling nearby economies. And as Gretchen Wilson reports, it’s quickly eroding a generation of gains that have made Kenya the economic hub of the region.

Gretchen Wilson: America’s top diplomat for Africa arrives in Kenya today, part of an international effort to mediate a political solution and get East Africa’s strongest economy back on track. GDP is growing at nearly 7 percent a year. Business confidence is on the rise, and there’s a fast-growing middle class.

But last week’s contested presidential election has sparked the worst unrest in decades. Hundreds have been killed in political and ethnic violence, and more than 100,000 people have fled their homes.

Shops have been looted of food and fuel. Road and rail transportation are slow, and that’s hampering trade. Businesses say they’re losing about $30 million a day. The knock-on economic effects may be huge.

Take tourism, one of the country’s biggest industries. Britain has warned against non-essential travel to Kenya, and British tour operators are suspending all trips for the next two days.

I’m Gretchen Wilson for Marketplace.

All reporting by Gretchen L. Wilson, © 2008

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