IMPACTS OF TERRORISM ON KENYAN ECONOMY
For a couple of years, Kenya has immensely experienced a surge in terrorist attacks .the devastating and the far-reaching consequences have greatly felt in the various sectors of the Kenyan economy. This particular essay highlights the devastating impacts of terrorism on the Kenyan economy with a keen focus on the unprecedented effects on the tourism sector, foreign direct investment, and effect on the resource allocation to counties. Therefore the effects of tourism on these various sectors have far-reaching consequences on the infrastructure and the general Kenyan economic development at large. The terrorist and violent extremism have not only compromised the security and the enabling environment for the bumming investment but it also trivialized the harmonious coexistence in the country.
According to the research, tourism I play a pivotal role in terms of foreign exchange, employment, and tax revenue. it is believed that the sector contributes to approximately 27% of the Kenya foreign exchange .nonetheless, the countries at the moment is writhing in the yoke ravaging terrorism activities majorly the looming threats from the illegal terror group of the Al-Shabaab which is believed to be stemming from the larger group of the Al-Qaeda. Recently there have been a series of al-Shabaab attack within the Kenyan borders which has led to an innumerable number of injuries, deaths and the massive destruction of the properties. The continued intensity of the terrorist attack has prompted the zealous intervention of the Kenya military to Somalia in the year 2011 aggravated the already worse situation by stimulating more attacks near the border of the Somalia and Kenya .according to the research, the ill motives behind these attacks was to instill fear on the esteemed tourists and the foreign investors coming to Kenya. Bulgur and Amanda in their research suggest that the significant increase in the total fatalities immensely led to a loss of the quarter of the expected tourist in Kenya. This reduction in the arrival of the tourist especially in the years 2013 and 2014 had then ripple consequences on the Kenyan economy .due to reputation plummeting, Kenya was no longer considered an appropriate option for the investment. Consequently it led to a notable increased in unemployment in Kenya.
Furthermore as the results of the massive destruction on the infrastructure, and the brutal killing from the terrorism activities, the Kenyan government has heavily diverted the funds mend for the investments to the security. The terrorism activities have also curtailed freedom of the investment in some of the war-torn areas in Kenya thus this menace has greatly crippled the income flow from the foreign investors. According to the research done by Kinyanjui (2014), he found that terrorist activities have immensely cowed away a large number of foreign investors. The research shows that 70% of the foreign investors have the perception that the security in Kenya has significantly deteriorated hence they fear investing heavily or shy off. As a result, there was a 14% reduction in Foreign Direct Investments (FDI) of all GDP. This research evidence vindicated deteriorated security in Kenya’s security. According to Lumumba (2013) the adverse effect on the Nairobi stock exchange has by extension lowered the rate of the stock return which greenery paralyzes the income flow from the foreign exchange.
The research done by the Nairobi Institute of the diplomacy and the international studies found that there is a notable negative impact of the terrorism activities to those counties where the terrorism transpired. This significant deterioration of the economy in these counties because of the bans and restrictions placed by various governments various grenade in Nairobi and the northeastern region in the year 2013 crippled the economic development and the tourism sector which contributes up to almost 60% of the counties’ GDP. Besides similar insecurity was felt in the coastal region like Mombasa. These terrorism activities did not only destabilized the local market in these counties but also rendered them as the hotspot for the terrorism activities.
In conclusion the impact of the terrorism and extremism in Kenya on t6he tourism, foreign direct investments, and resource allocation to the counties has an extensive impact on the livelihood of the entire Kenyan population.it worth noting therefore that the government has to scale up and boost the security further to revive the diminishing economy.