Uganda and Rwanda businessmen are threatening to revive a 2009 court case against Kenya over a $47 million compensation claim arising from the 2008 post-election chaos.

The businessmen have given the Kenyan government up to the end of this month to pay the Ksh 4.9 billion ($47 million) in compensation or else revive the case that had been stayed to allow negotiations out of court.

The two countries are demanding compensation for the destruction of their trucks and goods along the Northern Corridor (Nairobi-Eldoret-Kampala highway). Sixteen Ugandan and Rwandan traders have been pushing for compensation through diplomatic channels, but their efforts have born no fruits despite President Kibaki having given a directive that the traders be paid.

The chairman of the Kampala Traders Association, Issa Sekito, told The EastAfrican that unless Kenya leaders took the issue seriously, it poses a great danger to the economic relations between Kenya and the two countries.

“We are seeing a situation where the Kenya government is dishonouring diplomatic notes. Then what diplomacy are we talking about as members of one community?” said Mr Sekitto who warned that Ugandan traders will hold demonstrations at the Kenyan High Commission in Kampala if nothing is done by October 30.

On top of the claims, Mr Sekitto said, there are other unresolved issues over the port of Mombasa, which those in the landlocked countries had the understanding would belong to all five EAC member countries once the Common Market was in place.

(Read: Uganda threatens to boycott Port of Mombasa over transit cash bond)

The traders filed a suit in Nairobi court in 2009 for general damages enjoining the Police Commissioner and the Attorney-General after they failed to get assistance from diplomatic offices in their home countries.

They based their suit on the United Nations Convention on Economic, Social and Cultural Rights that compels states to guarantee security of goods transiting through their countries.
But the former Attorney-General, Amos Wako convinced the traders, operating under the East African Freight Forwarders Association (FEAFFA) to stay the case for the time being to allow for negotiations in the spirit of the East African Community. 

The government then formed an inter-ministerial committee, which later forwarded its recommendations to the head of Civil Service and  Secretary to the Cabinet, Francis Kimemia, whom FEAFFA is accusing of failure to act.

This forced the Association to contact President Kibaki, who in January 2012, directed then Minister for Finance, Uhuru Kenyatta and the Minister for East African Community Affairs, Musa Sirma, to settle the claims within two weeks, but it is yet to happen.

In September this year,  FEAFFA wrote a letter of undertaking to Mr Kimemia promising not to initiate any fresh claims apart from the Ksh 4 billion lodged earlier.

Mr Kimemia is yet to reply. When contacted, Mr Sirma, said he was not in position to comment but conceded that the issue has the potential of soiling negotiations issues pertaining to regional economic integration.

FEAFFA is concerned that promises and undertakings from the Kenya government have been used to shield by traders and creditors from foreclosure and all manner of debt recovery. But the once strong shield is developing cracks.

“There is nothing you can use to convince creditors after four years,” said Mr Sekitto.