Corruption was a hot issue in Kenya's election last week, and analysts say it will continue to be during the next several years.  Many of the ruling party's best known legislators and Cabinet members were defeated in the polls, and President Mwai Kibaki declared victory after a slim and contested margin.  William Eagle reports from Washington.

Analysts say corruption in Kenya was one of a number of economic and political issues that made for a very tight national election.  They say the new administration will have to tackle those same issues during the next five years.

CEO Mwalimu Mati of The Mars Group, an anti-corruption and good governance organization in Nairobi, says the country is affected by corruption, both large and small.

Mati says Transparency International describes the situation in a recent report.  It said from a business point of view, potential investors perceived Kenya as among the 10 most corrupt countries in the world.

"Corruption is endemic," Mati said. "There is the petty bribery of the average man encountering police or clerks of the state bureaucracy in public institutions ...   So in Kenya, the very poor are paying several bribes per month, which they can ill afford."

He says things are not much better at the national level, where he says only 10 percent of the population controls most of the country and enjoys most of the benefits of its robust economy.

"So, we have petty and grand corruption at levels no growing economy can sustain, because all this money gets funneled out as it comes in," Mati said. "If we lose 20 percent of the government procurement budget each year, then there is not much hope for much real sustainable and equitable growth."

Analyst Mwalimu Mati says corruption also hinders democracy.  He says a recent U.N. survey found that more than half of the money financing political parties could not be verified as legal.  He says some people fear the money could come from the illicit trade in arms.  

He calls large-scale corruption and the money it generates a war chest for generating political power.

Mati said in mature democracies political parties are based on ideas and ideology, but in Kenya they are created to serve the interest of monied elites, not the average citizen.  In Kenya, he says alternatives to the ruling KANU party are short-lived and are led by aging leaders.

"Nobody in Kenya is a card-carrying member of any party for any serious length of time.  No one learns about the constitution of a party or its policies," Mati said. "People join a party because at the helm is someone from their tribe.  So it s always a tribal contest and that is not good for nation building.  Where races are tight and tempers are high, people start to see other Kenyans as enemies and not as political opponents."

Mati says one solution to the problem is to give more power to the regions in a new constitution.

Voters rejected constitutional reform in a referendum two years ago, but Mati and many others say the government-backed final draft of the rejected constitution did not go far enough to decentralize the country in order to reduce what critics say are almost autocratic powers invested in the head of state. 

John Otieno is on the board of the Kenya Union of Journalists.  He says Kenya's Muslims are in favor of greater autonomy.

Otieno says Muslims form a powerful voting block in Mombasa and other areas of Coast Province, as well as North Eastern Province along the border with Somalia.  Otieno says these are areas rich in diamonds and other minerals, and many international companies have expressed interest in investing there.

"The northern communities believe they would do better with a devolved system of power, where they could control resources," Otieno said. "Opinion polls confirm that federalism is popular among [up to 60 percent of] the people of Kenya [including Muslims]."

Nairobi-based analyst Ojwang Agina says a new administration should consider eliminating the creation of small districts, often based along tribal or other demographic lines.  After coming to power in 2002, President Kibaki increased the number of districts from 60 to about 140.  The government says they are needed to improve local development.

Agina disagrees.

"He has created districts in parts of Rift Valley, parts of Western Province and parts of the Coast [Province]," Agina said. "The areas where he created them  are not planned in advance for government policy, but as campaign tools."

Analyst Mwalimu Mati and other pro-democracy activists say they favor the creation of a justice and truth commission to look into allegations of past economic and political crimes.  They say the process should include restitution for those whose human rights have been violated.  Muti says NGOs are determined to work with whoever is elected to create bodies that will monitor economic crimes and help curb them.

President Kibaki has said that in a second term he would support a new constitution, and he favors a more limited form of political devolution than those suggested by his opponents, which he says could exacerbate ethnic tensions. 

According to The Nation newspaper in Nairobi, President Kibaki told voters that if he won, he would continue to crack down on corruption.  He said any cabinet minister suspected of corruption would have to resign immediately.  In his first term, some government officials resigned after being linked to financial wrongdoing, but were reinstated after investigations cleared them.