Kenya: Economy expands at slower rate in Q2 2022
Economic growth continued to lose steam in the second quarter of 2022, with GDP expanding a milder 5.2% year on year. The result came in below the 6.8% increase recorded in the prior quarter and was the softest since Q1 2021. Underlying momentum also moderated in Q2, as GDP clocked a 0.8% expansion in sequential terms, marginally down from the first quarter’s 1.0% seasonally adjusted quarter-on-quarter growth.
The slowdown in annual growth was partially due to an unfavorable base effect, as the economy grew 11.0% in Q2 2021. The mining and quarrying sector posted 33.5% growth in April–June, which was a marked slowdown from the 77.7% expansion recorded in the prior three months. Growth in the accommodation and restaurants sector also more than halved in the second quarter, to 22.0% (Q1: +56.2% yoy). Construction sector growth also moderated during the quarter (Q2: +5.8% yoy; Q1: +6.4% yoy), as did the transport and storage sector (Q2: +7.1% yoy; Q1: +7.8% yoy). Manufacturing activity growth softened to 3.6% in Q2, down marginally from the prior quarter’s 3.7% increase. Meanwhile, the all-important agricultural sector contracted at a sharper 2.2% annually in Q2 (Q1: -0.7% yoy), chiefly due to a severe drought.