Kenya is expected to post faster than previously thought economic growth this year but the country must encourage political stability and take measures aimed at reducing interest rates, its president said on Tuesday.
Mwai Kibaki told parliament the region's biggest economy could expand by 4.5 percent this year from 2.5 percent in 2009. The 2010 outlook is slightly higher than initial forecasts by government and the World Bank of 3-4 percent.
"To experience real growth and success in the war against poverty, we must get our act together on two fronts," Kibaki said at a re-opening ceremony for parliament.
"Our politics must promote political stability and public confidence in the future of our country. Secondly we must take policy initiatives that will reduce and maintain low interest rates."
Kenya's economic growth was slowed down sharply by a bloody post-election crisis in early 2008. A prolonged drought and the global economic crisis compounded the effects, slowing growth to 1.7 percent in 2008, after expansion of 7.1 percent in the previous year.
Its recovery back to a path of robust growth is sometimes overshadowed by bitter rows in the grand coalition government that Kibaki and Prime Minister Raila Odinga formed after international mediation to end the post-election crisis.
The latest row between the coalition partners was sparked by the suspension of two ministers whose ministries have been accused of graft. The disagreement caused uncertainty and pushed the shilling to an eight month low against the dollar.
Kibaki had quashed an order issued by the prime minister for the two ministers, including former Odinga ally and agriculture minister William Ruto, to step down and allow investigations of corruption in their ministries.
Analysts say the order weakened Odinga's might in parliament by aligning Ruto and his supporters with the president.
Kibaki's office said both leaders met on Tuesday ahead of the re-opening ceremony for parliament. Details of their discussions were not immediately available but one of Odinga's aides had previously indicated the row over corruption would be ironed out at the meeting.
During its latest sitting, parliament will debate a proposed constitution, a key part of reforms which both sides have committed to implement, to ensure the country does return to violence again.
A draft will be tabled for debate in parliament in the next few days, Kibaki said. Many Kenyans say a new constitution would help deal with a culture of impunity that has taken root in Kenya.
"I thought (the speech) a call to arms regarding the economy," said Aly Khan Satchu, an independent trader and analyst. "I thought it interesting in that it was a call to parliament and confirmation that the president has redrawn the parliamentary map and numbers in his favour."
Constant bickering and political posturing between the two camps has hindered substantial progress on reforms and the eradication of prevalent corruption.
Kibaki said an Election Bill to help prevent voting malpractices and another on police reforms, would be tabled during the just kicked-off parliamentary session.
Finance Minister Uhuru Kenyatta is also expected to seek approval from the house for supplementary spending plans next month.
ReutersLast Mod: 23 Şubat 2010, 20:49