Kenya's Presidential Rerun Next Month Said Unlikely

(Bloomberg) -- Kenya's chances of holding a rerun of last month's annulled presidential election on time are fading as electoral law amendments proposed by the ruling party widen divisions at the commission organizing the vote, according to an official at the electoral body familiar with developments.

Some senior members of the Independent Electoral & Boundaries Commission will refuse to take part in a new election as things stand, said the person, who asked not to be identified for reasons of personal safety. Amendments that President Uhuru Kenyatta's Jubilee Party plans to pass in parliament would effectively place the commission under its control, the person said.

The main opposition alliance on Thursday quit negotiations over how to manage the Oct. 26 vote, saying amendments proposed by the Jubilee Party would “create a lame-duck commission.” The changes would include enabling commissioners to appoint a new chairman and reducing the number of people required to make a quorum, according to a copy of the bill provided by government spokesman Eric Kiraithe's office.

Kenya's Supreme Court nullified the Aug. 8 election after finding the electoral authority committed “irregularities and illegalities.” The opposition, led by Raila Odinga, has demanded changes be made to the IEBC's staff and systems -- a move opposed by Kenyatta, who was initially declared the winner of the vote.

Investor Losses

Uncertainty about the new election is unnerving investors and clouding the outlook for an economy that's already slowing. Kenya is a regional hub for companies including Toyota Motor Corp. and is on the cusp of becoming an oil producer, with Tullow Oil Plc among firms that are developing the discovery of at least 1 billion barrels of crude resources.

Kenya's Eurobonds have lost investors 1.3 percent since the Sept. 1 court decision, making them the worst performers in Africa, according to data compiled by Bloomberg. The Kenyan shilling has weakened 0.2 percent against the dollar in that period.

A split in the seven-member commission is making it impossible for it to agree on changes suggested by the Supreme Court ruling, the person said, citing the example of a proposal to procure new ballot papers from a fresh supplier that was blocked by four commissioners.

IEBC chairman Wafula Chebukati on Thursday said more legislation isn't necessary to hold the election on Oct. 26 and the proposed changes would place the commission in a “precarious situation.”

Guaranteeing Transparency

Kenyatta told a campaign rally Friday that the proposed electoral law changes will guarantee transparency by preventing malpractice. Deputy President William Ruto, speaking at the same event, said the vote will go ahead as planned.

“Kenyans will go to polls in October 26 whether Mr. Odinga participates or not,” he said.

“There is an attempt by Jubilee at changing the rules of the game midstream,” Samwel Mohochi, executive director at the Kenyan section of the International Commission of Jurists, said by phone Friday from Nairobi, the capital. “The effect of this grandstanding is further polarizing the country which may lead to violent confrontations.”

The Jubilee Party campaign spokesman, David Murathe, said the amendments are necessary to ensure there is “no running away from elections.” Parliament will approve them when it returns from recess early next month, he said by phone.

Election Disputes

Previous disputes over elections in Kenya have led to violence, the most serious being in 2008, when clashes left more than 1,100 people dead and forced 350,000 more to flee their homes. That resulted in growth slumping to 1.7 percent in 2008 from 7.1 percent a year earlier.

After the talks' collapse, Odinga announced nationwide protests will begin Oct. 2, continuing every Monday and Friday until the opposition's demands are met.

“You cannot come up with a piece of law that contradicts the constitution -- that includes issues of commissioners' quorum and decision making around that,” Mohochi said. “Legally speaking you can't formulate laws and have those laws have a retroactive effect. This election remains a process and it's a continuation” of the annulled vote.

--With assistance from Paul Wallace

To contact the reporter on this story: Felix Njini in Nairobi at fnjini@bloomberg.net.

To contact the editors responsible for this story: Rene Vollgraaff at rvollgraaff@bloomberg.net, Karl Maier, Michael Gunn