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Kenya’s Economy at Risk: The Cost of Banning LGBTQ Practices

kenyas economy at risk the cost of banning lgbtq practices
kenyas economy at risk the cost of banning lgbtq practices

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A recent study has highlighted potential economic consequences for Kenya if legislation is enacted against Lesbian, Gay, Bisexual, Transgender, and Queer (LGBTQ) practices. The report underscores that Kenya could face substantial economic losses, estimated at Ksh4.186 trillion ($28.13 billion), if President William Ruto signs the Family Protection Bill into law, as proposed by Homa Bay Member of Parliament Peter Kaluma.

The study, presented by economist and social scientist Professor Fred Ogola, raises several concerns regarding the possible approval of anti-LGBTQ laws. These concerns include investor sentiment, impacts on the prison system and inmate population, government expenditures, and the need to update official documents. Professor Ogola emphasized the importance of policymakers approaching these matters with caution.

Furthermore, the study warns that adopting the Linda Jamii Bill would place Kenya in violation of Article 7 of the United Nations Declaration of Human Rights, to which the country has been a signatory since 1963.

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Professor Ogola noted, “Kenya heavily relies on foreign donors, particularly the European Union and the USA. These donors have set preconditions for their continued support, and one of these conditions, unfortunately, is support for LGBTQ rights, which is framed as equal protection and non-discrimination for all individuals regardless of race, ethnicity, religion, sexual orientation, gender, etc.” Violating any of these conditions could result in the withholding of financial support, potentially causing Kenya to lose approximately Ksh4.186 trillion.

The estimated loss comprises various components, including tangible benefits to Kenya’s economy and development from the USA (approximately Ksh446.7 billion or $3 billion annually), humanitarian assistance from the USA (approximately Ksh446.7 million annually based on 2022 figures), and European Union development aid (approximately Ksh713.2 billion or $4.8 billion under the Joint Cooperation Strategy 2018-2022). Additionally, humanitarian funding from the EU (Ksh2.4 billion or $16.13 million), disaster preparedness funding (Ksh238 million or $1.6 million) provided by the EU in 2023, IMF approval for Kenya (Ksh148.9 billion or $1 billion in July 2023), IMF support for climate change resilience (Ksh82 billion or $551.1 million), funds for implementing the bill (approximately Ksh11 billion or $73.9 million), and losses in the tourism sector due to international community perception make up the substantial figure.

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The study employed various economic indicators, such as employment, capital, labor force, population, and international trade, to arrive at these findings.

The report underscores that criminalizing LGBTQ freedoms through discrimination and exclusion not only affects the mental and physical health of individuals but also has negative impacts on the national economy. LGBTQ students facing unfair treatment in schools often discontinue their education, leading to an underutilization of their potential.

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Furthermore, LGBTQI immigrants are typically highly educated and contribute significantly to the labor force, as suggested by prior studies in the US. Anti-LGBTQI legislation suppresses their freedom and hampers their ability to contribute to the economy, resulting in reduced productivity, lost labor time, underinvestment in human capital, and unfair resource allocation.