The role of foreign policy in ecomonic developement in Kenya, 1990-2010

Abstract

One of the central goals of the foreign policy of a country is to foster its economic development. This is especially so in the post-cold war period where economic diplomacy has gained currency replacing the predominant political and security preoccupations of the cold war era. The 1990s were crucial to states as they had to do undertake some adjusting to conform to the new world order which was inspired by liberal ideals that advocated free market economy, including free trade and other forms of economic exchanges to spread economic prosperity.

Among the many ways through which states sought to promote their economic development is the pursuit of Foreign Direct Investment (FDI). Many states embarked on economic and political reforms with a view to attracting the same. Others had a negative view of FDI terming it a new form of neocolonialism. Yet others still grapple with to find the right formula to attract and exploit the benefits that FDI brings.

This study examined the foreign policy of Kenya in the post cold war era and its contribution to economic development through inward FDI mobilization. It concluded that the former has been ineffective in mobilizing FDI despite embracing albeit begrudgingly, liberal economic ideals. However the little FDI that was realized during the period under review made significantly contributions to economic development especially in Information Communications and Technology (lCT).

A review of the economic diplomacy of South East Asian countries also revealed that FDI has been at the very core of their development. It is thus the contention of this study that more needs to be done to bolster the economic diplomacy of Kenya to attract significant levels of FDI to promote economic development.