By Victor Adar

NAIROBI, July 11 (Reuters) - People who smoke in public in Kenya's capital Nairobi face a fine or up to six months in jail from Wednesday as the east African country instituted a smoking ban, a city official said.

Kenya's government has already implemented such bans in Mombasa and the Rift Valley town of Nakuru, saying it wants to cut the harmful effects of secondhand smoke. The authorities say some 8,000 Kenyans die every year from smoking.

"Anywhere that is not designated for smoking is banned and people will be arrested and charged," Nairobi town clerk John Gakuo told a news conference. First-time offenders will either be fined 2,000 shillings (about $30) or be jailed for six months. Repeat offenders face a bigger fine or up to nine months in prison, he said.

"This will be implemented immediately."

Small local pubs would be exempted, Gakuo said, but restaurants must provide separate smoking areas if they want to let their customers light up.

Last year a Kenyan court suspended a smoking ban ordered by the Health Ministry after it was challenged by the Kenyan unit of British American Tobacco Plc and a local manufacturer.

The two companies estimated that they would lose more than $10 million each if the legislation was enforced.

Also concerned are some 300,000 Kenyan tobacco farmers, who fear seeing a reduction in their already meagre income.

Reaction on the Nairobi streets was mixed.

"The ban is good and it should continue. ... There is no respect on the streets. People are just smoking aimlessly," said taxi driver Bernard Mogaka.

"The government should also close these tobacco companies."

Wilson Yida Madegwa, a fumigation specialist, suggested the government should set up areas specially designated for smokers -- who would then be asked to contribute cash for their upkeep.

"It will discourage smokers because it will be expensive for them," he said. "And the government will make money."

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