Magazine article African Business

Lamu - Back to the Future: Lamu, on Kenya's Northern Coastline, Is Now a Tourist Idyll and a UNESCO World Heritage Site, but Five Centuries Ago, It Was a Crucial International Commercial Hub before It Gradually Lost Its Status. All This Could Be about to Change as the Island Shakes off the Dust of History and Prepares to Resume Its Old Role Once Again. Wanjohi Kabukuru Reports from Lamu Island

Magazine article African Business

Lamu - Back to the Future: Lamu, on Kenya's Northern Coastline, Is Now a Tourist Idyll and a UNESCO World Heritage Site, but Five Centuries Ago, It Was a Crucial International Commercial Hub before It Gradually Lost Its Status. All This Could Be about to Change as the Island Shakes off the Dust of History and Prepares to Resume Its Old Role Once Again. Wanjohi Kabukuru Reports from Lamu Island

Article excerpt

In Kenya's current economic set-up, Lamu is more of an idyllic tourist getaway island, well known for its status as a World Heritage site, thanks for its preservation of Swahili history over the centuries. Small wonder that, when a French tourist was abducted in 2011 and a British honeymooner killed, the island experienced a tourist slump for a while.

With a history dating to the 8th century and globally acknowledged as East Africa's Islamic capital, complete with Islamic festivals such as the Maulidi (celebrating the Prophet's birthday) observed every year, Lamu boasts a rich intercultural diversity in its history. The Omani Arabs, Portuguese, Germans and British have all flown their flags here at one time in history.

While they symbolised political domination, they essentially denoted economic control. In the 1500s, Lamu was a flourishing seaport connecting maritime trade routes of the Middle East, India and the Far East. Barter trade in timber, turtle shells, rhino horns, slaves and ivory in exchange for clothes and spices prospered due to the friendly northeasterly monsoon (kaskazi) and southeasterly monsoon (kusi) winds. It now seems that the events of five centuries ago are about to be replayed.

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Lamu, 724 km from the capital Nairobi, on Kenya's northern coastline, has been a tourist haven, thanks to its rich heritage and azure blue waters with long stretches of sandy beaches in Shela and Manda Island: lately it is taking on a new sheen.

"Somehow we all knew there was something special about Lamu in terms of natural resources and maritime species. We just didn't know what it was. With the current excitement of a new port and interest amongst major oil companies in our island, I guess now we all know," says Jaffar Shemanga, who has lived all his life on this island.

The excitement that is sweeping across Lamu is informed by events that may see Lamu reemerge as a centre of commerce yet again. The $25bn Lamu Port-Southern Sudan-Ethiopia Transport (Lapsset) Corridor, capped by renewed interest by multinational oil giants in prospecting for oil in the Lamu basin and the steep rise in real estate value in the entire Lamu archipelago, are all contributing to creating a phoenix-like revival, turning Lamu into a regional economic hub. Palatial, high-end beach houses are springing up in Shela beach and Manda Island.

Asking prices for houses in the fashionable villages of Shela, Manda, Ras Kitau and Kipungani range from [euro]100,000 to [euro]500,000. Most are owned by wealthy Europeans, who keep them as holiday homes. Princess Caroline of Monaco and Prince Ernst of Hanover own several. Lamu's quiet and unencumbered lifestyle of sailing dhows and donkeys for travel attracts both glitterati and backpackers.

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Oil majors move in

Away from real estate is the quest for oil. So far, Kenya has no known oil reserves, but the interest generated by global petroleum multinationals is what is exciting Shemanga and other islanders.

French oil giant Total has already indicated that it will be acquiring a 30% stake in five oil exploration blocks in the Lamu basin through its local subsidiary Total E&P Kenya BV. The five are Blocks L5, L7, L11a, L11b and L12. Currently these blocks are operated by Anadarko Kenya Company, Cove Energy and Dynamic Global Advisors. In the new arrangement, Cove and Dynamic Global will each contribute a 5% stake and Anadarko will cede a 20% stake to Total E&P Kenya BV. In return for the 30% stake, the oil multinational will finance future prospecting and exploration works on the five blocks. On top of these, Total will buy Dynamic Global's remaining 15% stake in the blocks. On completion, Cove will retain a 10% stake in the blocks, Total will control 40% and Anadarko, who will remain as the blocks' operator, will have a 50% stake. …

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