Malindi, located about 120 kms northeast of Mombasa, is one of the large tourist towns along the coast. Malindi, once known as Melinde, is a town on Malindi Bay at the mouth of the Galana River, lying on the Indian Ocean coast of Kenya. The population is approximately 120,000. It is the capital of the Malindi District.

The Arabs founded Malindi in the early thirteenth century. In 1414, the King of Malindi initiated diplomatic relations with China during the voyages of the explorer Zheng He. In 1498, Malindi authorities welcomed the great Portuguese explorer, Vasco da Gama. The following year East Africa’s doors to Europe opened officially as the Portuguese established a trading post.  At this time, the town was a kingdom and wealthy.  The inhabitants were mixed with the Arabs being the ruling class and walls surrounded the town. The Arabs were living inside the walls in stone houses, while Africans mainly lived outside in mud-and-wattle huts with palm thatch roofs.  

The economy consisted of agriculture and trade with various ports in the Indian Ocean. There were large plantations with fruits (lemons, oranges), coconut palm trees, vegetables and cattle and around Malindi. Slaves and ivory were exported. The town was an important port in East Africa.  

In the beginning of the sixteenth century the Portuguese selected Malindi as a supply station for Portuguese ships hence building their own administration, supply station and customhouses. In 1518 Mozambique took over Malindi’s role as supply station for Portuguese ships as the Portuguese had problems to defend Malindi.

With the construction of the Portuguese Fort Jesus in the neighboring town of Mombasa (1593) Malindi declined. The Portuguese administration and the customs houses were transferred to Mombasa leaving no administration in Malindi. After 1666 the Portuguese lost complete control of Malindi.  

The Sultan of Zanzibar refounded Malindi in 1861and its wealth increased between 1861 and 1890. Arab governors appointed by the Sultan of Zanzibar and supported by a garrison of between thirty and one hundred and fifty Baluchi troops administered the town. After 1873 slave trade became illegal leading to a decline in agricultural economy, as Arabs were partly unwilling to hire local Africans on a wage basis. The Sultan of Zanzibar later leased his territories, which included Malindi region, to the British East Africa Association.

In 1906, a new group of Europeans began planting and exporting large quantities of rubber from their plantations but this ended in 1917 as rubber prices fell sharply because of overproduction in Malaya. From 1925 to 1938, there was drought followed by floods leading to a decline in agriculture production. However, there was a big increase in production of cotton until 1935, when the price of cotton decreased sharply.

During the World War II there was not much economic development in the Malindi area. By late 1944 the holidaymakers from upcountry were returning, and the army was slowly pulling out, so that Malindi once again returned to normal.

In 1960 mass tourism started by charters landing in Mombasa and put Malindi on the world map. Today Malindi is in the midst of a tourist boom primarily due to its spectacular beaches. 

The town is served with a domestic airport and a highway between Mombasa and Lamu. The nearly Watamu resort and Gedi Ruins (the remains of a Swahili town located in Gedi, a village near Malindi) are located south of Malindi.  In 1948, the remains of Gedi were declared a Kenyan national park. The mouth of the Sabaki River lies in northern Malindi. The Watamu and Malindi Marine National Parks form a continuous protected coastal area south of Malindi. The area shows classic examples of Swahili architecture.

References

http://www.answers.com/topic/malindi
http://www.kenya.de/pages/malindie.html
http://www.kenya.com/malindi.html
http://www.malindikenya.com/HISTORICAL%20BACKGROUND.htm