Exclusive photos: Kenya Navy ship rotting in Spain

A Kenyan news blog has obtained exclusive photos of a controversial Kenya Navy vessel rotting away in Spain while Somali pirates threaten the port of Mombasa.

The KNS Jasiri at a Spanish port, where it has docked for years.

The KNS Jasiri at a Spanish port, where it has docked for years.

The KNS Jasiri, valued at over Shs4.1 billion (US$52 million), cannot be delivered because of a contractual dispute between the Kenya government and the ship’s builder.

The Kenya shield clearly indicates the true ownership of this vessel.

The Kenya shield clearly indicates the true ownership of this vessel.

As late as last week, people at the Spanish port of Ribadeo where the vessel is moored, were wondering why the ship has been left to gather rust. There is a sign on the ship that says visitors are not allowed on board.

Click here for the story and exclusive photos from Breaking News Kenya >>

More killings feared as Kibaki vows new Mungiki war

President Mwai Kibaki has vowed to crack down on the Mungiki sect even as torture and disappearances undermine ongoing government efforts of eradicating the sect.

The President is enraged by the killings of at least 10 people in his parliamentary constituency. The dead are believed to have been executed by Mungiki adherents, who are known for demanding protection fees from retail business, land owners and transport operators across Central Kenya, Nairobi and parts of the Rift Valley.

Since June 2007, at least 600 youths have been killed for alleged involvement with Mungiki. Scores of others have simply vanished after they were arrested.

Survivors and civil society accuse the Kenya Police for the deaths and disappearances, a claim the police Commissioner has denied several times. However, former internal security minister, John Michuki, was quoted last year saying that funerals of Mungiki youth would become a common occurence.

Mungiki is an underground movement among the Kikuyu ethnic group, drawing its membership from youths in squatter settlements and urban slums. The group advocates a return to Kikuyu traditional customs saying that modernity has failed to ease human suffering.

Mungiki leader, Maina Njenga, is serving a jail sentence for drugs and weapons possession but the sect describes the charges as a fabrication meant to curtail its activities.

Njenga began Mungiki in the mid 1980s in the Rift Valley province. His movement grew in numbers in the 1990s following clashes inflicted on the Kikuyu by forces loyal to President Daniel arap Moi.

The 1990s were a period of rapid economic liberalization in Kenya coupled with globalization, resulting in massive unemployment coupled with the loss of societal values. Rising crime and crumbling state authority added to the difficulties.

Within the shanties of the Kikuyu homeland and the capital city Nairobi, Mungiki restored order and provided basic social services in exchange for protection fees by households and businesses. By the early 2000s, Mungiki membership was estimated at over 1 million.

Since then, the Kenyan government has worried over the motives of Mungiki and sees the sect as a threat. Sections of the government are convinced that Mungiki’s goal is to capture power through its political wing, the Kenya National Youth Alliance.

Mungiki is not a movement of angels either. Dozens of people have been killed by the sect for either exposing the group’s secrets or refusing to pay protection fees. Mungiki does not allow revocation of membership and recruitment procedures are rather nasty.

Whereas President Moi kept the group in check through negotiation, his successor President Mwai Kibaki has pursued a hardline stance. Ironically, Kibaki is also a Kikuyu whereas Moi was not.

Being a phenomenon of the underclass, Mungiki does not enjoy the complete loyalty of the Kikuyu. Majority of upper and middle class Kikuyu support Kibaki’s crackdown against Mungiki, leading many social commentators to draw similarities with the Mau Mau war of the 1950s. Like Mungiki, Mau Mau drew its membership from the poor whereas the educated Kikuyu working for the colonial government opposed it.

Incidentally, John Michuki, the man who predicted Mungiki funerals in 2007 worked as a colonial administrator in the 1950s where he was tough against Mau Mau. Its worth noting that Mungiki draws its inspiration from the Mau Mau rebellion.

The rest of Kenya’s ethnic groups fear Mungiki and support the government’s campaign despite the violations of human rights. With Mungiki’s membership being exclusively Kikuyu, the rest of Kenya’s tribes see the group as an ethnic militia championing Kikuyu interests.

Consequently, there has been little condemnation of the government from the rest of the population. However, this apathy may change as the Kenyan government spreads its tactics to other parts of Kenya.

Security operations in Mount Elgon and the Somali border have been marred by similar allegations of torture, death and disappearances. It may seem as though the Kenyan government is adopting tactics last seen in Latin America back in the 1970s.

Perhaps, Kenyan leaders and security chiefs should familiarize themselves with ongoing legal procedures in Latin America. More than 30 years after the era of leftist groups and right wing paramilitaries (usually backed by military governments), trials are currently underway for those responsible for the disappearances.

Kenya could be Obama’s downfall

Short of some cataclysmic event, the victory of Illinois Senator Barack Obama in the US Presidential election is almost guaranteed.

Barack Obama

Barack Obama

Senator Obama is viewed as having great potential to transform the United States presidency, after the ire it attracted in eight years of President George W. Bush. There’s lots of excitement in Kenya as well, because Obama’s father was a Kenyan. Barack Obama Senior went to the United States as a student, where he met Obama’s mother – a descendant of Irish immigrants.

Amidst all the optimism about Obama, little mention is being made of the fact that Kenya could be Obama’s weakest point. Like the proverbial Greek mythology of Achilles, whose weak point was his heel, Kenya is likely to turn into Obama’s Achilles heel.

By coincidence, the General Election of 2012 will coincide with the next American presidential election. Whatever happens in Kenya between now and 2012 will determine whether or not Obama wins a second term of office.

During the presidential campaigns, Obama’s opponents in the Republican Party made a huge deal about the Senator’s relationship with Kenya’s Prime Minister Raila Odinga and the ODM Party. Raila comes from the Luo tribe of Obama’s father and has told the media that he is Obama’s cousin.

Now, problems arise out of ODM’s involvement in post election violence that rocked Kenya in early 2008 resulting in the deaths of over 1,000 people. At least 500,000 were rendered homeless when Raila and ODM rejected election results that gave President Mwai Kibaki a second term in the presidency.

The Commission of Inquiry into Post Election violence, chaired by Justice Philip Waki has blamed most of the top leaders of ODM for organizing violence against rival ethnic groups, or at the very least, condoning it. So heavily implicated was ODM that the party rejected calls for ethnic warlords to face a criminal tribunal on grounds that the tribunal would provoke violence from supporters of the suspected leaders.

To be fair, the Waki Report did implicate President Mwai Kibaki for holding meetings in State House that plotted retaliatory attacks against pro-ODM ethnic groups.

But the challenge for Senator Obama is on how he will interact with Kenyan leaders who have been associated with ethnic cleansing, corruption and electoral malpractices. By choosing to work closely with the leaders, Obama will be viewed as being complacent with their actions. In Kenya, years of impunity have numbed the populace into accepting whatever their leaders do or say. In the United States, any association with masterminds of ethnic warfare will spell doom for any politician regardless of his / her abilities.

That is the dilemma for Obama. Obviously, he is aware of the expectations of Kenyans that, as president of the United States, will play a positive role in influencing events. On the other hand, Obama’s opponents in the United States will be waiting for the slightest hint of co-operating with Kenya’s cruel and corrupt leaders. In other words, Obama can choose to ignore Kenya in order to save his presidency or alternatively, get involved with Kenya and risk everything he is working to achieve.

Kenya is far from being at peace. Ethnic tension is increasing as groups view each other with suspicion thanks to incitement by short-sighted leaders. Operation Rudi Nyumbani (Operation Go Home) launched in May to close refugee camps is mired in failure. Just a couple of days ago, villagers who had returned to their homes in the Rift Valley were attacked and threatened by rival tribes who want them to leave for good.

In Mandera, along Kenya’s border with Somalia and Ethiopia, fighting between rival Somali clans drew the wrath of the military into tormenting civilians instead of bringing culprits to book.

As the economy falters amidst decayed roads, erratic power supplies and water shortages, Kenya’s leaders award themselves huge pay perks that rival those of legislators in advanced countries. The President of Kenya earns almost as much as the President of the United States, yet the American economy is thousands of times bigger than Kenya’s output. Indeed, there are more police officers fighting crime in the city of New York than are employed by the entire Kenyan police force.

The money to pay huge salaries for politicians is obtained from a punitive taxation structure that has driven corporations into bankruptcy. The number of companies which were engaged in actual trading that have collapsed in the past ten years speaks volumes about Kenya’s business climate. Meanwhile, the Attorney General’s offices are inundated with applications for new companies whose main activities are speculation while soliciting government contracts.

The political leaders behind the miasma of filth in Kenya are lobbying for amnesty from political, financial and war crimes. They have rejected the Waki Report and its recommendations for prosecution. They rejected the Kriegler Commission when it accused political parties of violent nominations and rigging in their respective strongholds.

Kenya is not out of the dark woods yet, and its clear that major violence is likely to erupt at any moment between now and the year 2012. The way Obama handles the Kenya situation will play a major role in how he is remembered as an American president.

Obama is well advised to be wary of Kenya’s political hyenas for they can bring him down just as easily as they have brought down their own people.

Another national power blackout

Kenya was plunged into a power blackout Sunday morning barely six months after the previous national outage highlighted the derelict state of electricity supply.

The Kenya Power and Lighting Company (KPLC) blamed the national blackout on a breakdown at major transmission substation at Juja Road, east of the capital.

The Sunday outage caught many by surprise, as Christians were preparing to attend church services.

Frequent power blackouts are a hallmark of the state of Kenya’s power generation and distribution facilities, most of which were constructed in the 1970s and 80s. Increasing demand for power from a growing population has placed a strain on Kenya’s aging infrastructure.

Daily power outages are a common occurrence that have frustrated economic development in Kenya. A typical enterprise will experience at least two outages per day with high probability of blown computers and other equipment, resulting in heavy losses.

Inspite of the poor quality of supply, Kenyans are paying possibly the highest electricity tariffs in the world. In June this year, KPLC announced a price increase of 20% but consumers put the increase at more than 50% based on the bills they receive. KPLC says the higher-than-expected increase in electricity tariffs is due to high oil prices emanating from the use of oil-powered generators.

As a consequence of threats from manufacturers to relocate their operations from Kenya, Acting Finance Minister John Michuki last week announced a reduction in taxes for oil products. This, according to Michuki, should help reduce electricity costs and thereby save thousands of jobs.

Read about the May 2008 national blackout >>

Price controls will cause shortages

The Kenyan government’s threat to impose price controls on fuel could create shortages and make life worse for its people.

Faced with rising prices, declining agricultural production and a weakening currency, authorities in Kenya are eager to calm a restive population recently scarred by ethnic violence.

Analysts warn against price controls in an economy liberalized 14 years ago. “Market forces are the most efficient price determinant for goods and services,” says an economics lecturer at the University of Nairobi, “because governments often cannot act quickly enough to raise or lower prices depending on demand and supply.”

It is feared that spiraling inflation caused by rising commodity prices could undermine a fragile peace between supporters of President Mwai Kibaki and those of Prime Minister Raila Odinga.

This week, the coalition cabinet discussed the rising prices and their impact on the economy. During the weekend, the Prime Minister promised that the government would tackle high food prices but fell short of mentioning specific steps. Raila was addressing his constituents in the Kibera slum, Africa’s largest.

Meanwhile, acting Finance Minister John Michuki has promised to take tough measures against oil companies for not heeding a government ‘directive’ to lower fuel prices by Shs10 (US$0.133) a litre. Michuki accuses oil companies of greed, a charge widely repeated by Kenya’s media.

As international crude prices hit a high of US$147 by mid this year, petrol prices surpassed Kshs105 (US$1.4) a litre. Now, international crude prices have settled at below $100 a barrel but fuel prices locally have reduced marginally. Most stations are retailing petrol at about Kshs99 ($1.32) per litre.

Multinational oil companies say they are being condemned unheard. Intense competition in the sector has reduced profit margins to just a few cents for every litre of fuel. “Kenyans think that oil companies are making huge margins, which is not true,” explains the University of Nairobi lecturer.

Oil companies say they are yet to clear old stocks bought when international crude prices were still high. Besides, the weakening of the Kenya shilling is cancelling out any savings made from reductions in international oil prices. In the past month alone, the Kenyan currency has suffered 15% devaluation against the dollar.

Harsh taxation measures imposed by the Kenya Revenue Authority (KRA) to curb oil smuggling have placed a heavy toll on prices. KRA demands payment of oil taxes before the product is released for sale, a measure that forces oil companies to borrow amidst a worldwide credit crunch.

Meanwhile, taxes take up almost half the retail price of fuel in Kenya. The state has been urged to cut down expenditure in order to ease the burden on the Kenyan consumer. However, with a giant cabinet of 42, there are no prospects of tax cuts any time soon.

High fuel prices have had a domino effect on electricity tariffs, which have risen over 100% since June 2008. Manufacturers have threatened to relocate their plants lamenting that Kenya’s energy costs are among the highest in the world in spite of erratic power supplies. Businesses must operate fuel-powered standby generators which further drives up the energy bill. Already, hundreds if not thousands of jobs have been lost as industries cut production to a bare minimum.

If the government imposes price controls on fuel and other essential commodities, suppliers will not be willing to sell at a loss and severe shortages will arise – Zimbabwe style. A black market will emerge with the phrase ‘consumer-exploitation’ assuming a sinister meaning altogether.

Black markets are not subjected to quality standards and are controlled by criminal gangs. Shops and supermarkets will be empty as the Mungiki, Taliban and others have a field day smuggling essential commodities through the back streets. Kenyans will waste many hours queuing for items that should normally be readily available.

Such is the harsh reality should the government re-introduce price controls.

Co-op Bank plans IPO despite objections

In spite of consumer inflation driven by rising oil and food prices, the Co-operative Bank will go ahead with its initial public offering (IPO) at the Nairobi Stock Exchange.

There are fears that the IPO will be undersubscribed. Investor disappointment caused by the near-fiasco of the Safaricom IPO earlier this year is still fresh, and could dampen demand for Co-op Bank shares.

The IPO’s lead sponsoring broker has warned against the venture at a time of worldwide economic uncertainty and inflation. Mr James Wanguyu of Standard Investment Bank was quoted last week as calling for the IPO to be postponed till next year. However, Mr Wanguyu has since changed his mind to support the IPO.

Acting Minister for Finance, John Michuki, has also dismissed calls for a postponement of the Co-op Bank IPO.

The Co-operative Bank of Kenya, Kenya’s fourth largest, hopes to raise Kshs10 billion (US$136,900,000). According to a press statement, the money will finance the bank’s mortgage products, information and communication technology infrastructure and expansion of the branch network.

Back in 2006 the KenGen IPO made history by attracting the largest number of individual investors ever seen in the history of the Nairobi Stock Exchange. Economic fundamentals were different back then, with 6% economic growth, a stable political environment, a boom in consumer spending and billions of shillings in remittances from the diaspora.

Today, consumers are hit by inflation rates of close to 30% due to rising prices for fuel, electricity and food. Post election violence after the December 2007 polls has greatly reduced confidence in the economy whose growth rate this year is expected to fall below 4% at best.

Hundreds of thousands of families, which had invested in previous IPOs, were rendered destitute in the violence as farms and property were looted. Political infighting within the ruling elite hasn’t done much to restore investor confidence in the Kenyan economy.

Gloomy economic forecasts have resulted in job cuts among Kenyan industries. Companies are complaining of reduced consumer demand coupled with higher energy prices. Cuts in electricity and water supplies have added to a worsening of the country’s economic situation.

Economic uncertainties, mostly in the United States, have greatly affected the flow of remittances by Kenyans living overseas. Quite a number of them have already lost their jobs. Unlike previous share offerings, Co-op Bank’s IPO is unlikely to attract much interest from the diaspora.

The fiasco that was the Safaricom IPO tarnished the reputation of the Nairobi Stock Exchange. Apparently, planners at the stock exchange, Capital Markets Authority and the Central Depository had greatly under-estimated the logistics of having so many shares introduced at once. Safaricom shares, by themselves, currently constitute almost a third of all shares at the Nairobi Stock Exchange.

To start with, few people got the actual shares they had applied for. Many ended up with so little that their allocations became meaningless as far as investment is concerned. Cash refunds took too long to process; in some cases individual investors waited months to get back their money. There were allegations that brokers were trading with the cash, hence delays with the refund cheques. It was further claimed that the Central Bank of Kenya issued instructions that refund money be released slowly in order to prevent a crash of the Kenyan currency.

And because of the huge number of Safaricom shares, the share price did not shoot up as expected. Indeed, Safaricom shares are currently trading more or less around the IPO price of Kshs5 (US$0.068) a share. The result has been tangible disillusionment among the mass of retail investors.

Co-op bank hopes that its improved performance after a loss-making streak will attract ordinary Kenyans. Furthermore, Co-op is placing huge bets on an enthusiastic response from the co-operative society sector, which is the bank’s core business. Co-op says it has put in place an automated IPO processing infrastructure that will enable it make refunds within a short time.

Co-operative Bank made a profit of Kshs1.7 billion (US$23 million) for the last financial year ending 30th June 2008 and has a target of Shs3.3 billion ($45 million) for the current year.

Police death squads exposed in Mungiki war

A government human rights body has implicated Kenyan police in the abduction, torture and execution of at least 500 young men. Scores of others arrested from their homes cannot be found.

In its report, the Kenya National Commission on Human Rights says that top political leaders working with police commanders were aware of the death squads. Last year, Cabinet minister John Michuki, predicted that there would be “many funerals” of Mungiki members.

The report further accuses police officers of kidnapping, torture and extortion on the pretext of anti-Mungiki operations. For the unfortunate victims, payment of a ransom was no security against death. The commission has documented cases where individuals were hunted down and killed after paying ransom.

Mungiki, popular with disillusioned youth from the Kikuyu ethnic group, is calling for a return to traditional African spirituality. It despises Christianity as a colonial religion. In the teeming slums of Kenya’s cities and in rural squatter settlements, Mungiki has grown by providing casual jobs, protection, housing and other social services.

The Mungiki are calling for a generational change in Kenya to pave way for youthful leadership. According to Mungiki, Kenya’s current leaders are remnants of, “colonial home-guards.”

Since its beginnings in the 1980s, the group’s membership has grown to the lower millions. It has become a formidable political and quasi-militia force that has drawn the wrath of State security machinery. Kenya’s government declared war against the group in mid 2007.

The Kenya Police force, however, faces little condemnation for its actions. The ethnic affiliation of Mungiki has spawned fear of Kikuyu nationalism in the rest of Kenya’s tribes, especially after political and ethnic clashes earlier this year. Consequently, there has been no criticism of police tactics against Mungiki.

Mungiki’s leader and founder, Maina Njenga, is serving a five year jail term on weapons and drug possession charges. Mr Njenga says police falsified the charges against him. After his arrest, the state turned Mr Njenga’s mansion in Kitengela into a, “police station.” Kenyan police rarely confiscate property from criminal suspects.

Earlier this year, Njenga’s wife, Virginia Nyakio, was abducted, raped and beheaded by persons believed to be working for the state. Within a few days, two top officials of the Kenya National Youth Alliance – Mungiki’s party – were gunned down by unidentified people along the Nairobi – Naivasha highway. The two were on their way to see Mr Njenga in prison. One of the dead was a brother to Virginia Nyakio’s driver. According to eye-witnesses, the gunmen in the daylight shooting first identified themselves as police.

Mr Njenga has vowed not to allow the funeral of his murdered wife until the government drops all charges against him. Her body has been lying in a morgue ever since.

In April, Mungiki engaged riot police in national demonstrations to protest constant killings. Railway lines were uprooted and national highways blocked. The violence ended when Prime Minister Raila Odinga offered to negotiate with them. Police withdrew from Maina Njenga’s mansion in an apparent goodwill gesture from the government. Television footage showed the building suffering from extreme vandalism. Apparently police officers lit cooking fires on the living room floor.

The report by the Kenya National Human Rights Commission accused police of using unmarked vehicles to abduct Mungiki youth, most of whose bodies have been found in woodlands outside the capital city. Police deny they are involved in the killings. However, in parts of Central Province and in the slums of Nairobi, young men live in fear of abduction.

Public opinion in Kenya is split between those calling for dialogue with Mungiki and those insisting on tough measures. Majority of Kenyans associate Mungiki with extortion, crime and murder.

Numerous scholars and journalists have attempted to analyze Mungiki. The explanations of the Mungiki phenomenon are as varied as the number of papers and press articles about the group.

However, all agree that the Mungiki is a product of a dysfunctional society and without a change in the way Kenya is governed, Mungiki is likely to become a much bigger and dangerous phenomenon.

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