Kenya Economic Forecast

Kenya Economic Outlook

September 21, 2021

Available indicators suggest that the economy expanded at a quicker rate in Q2 following Q1’s projected growth. A healthy expansion in merchandise exports in the quarter hints at stronger foreign demand, while soaring import growth in the period suggests that domestic activity also gained steam. Moreover, June logged the highest number of tourist arrivals since February 2020, boding well for the country’s hospitality sector. Turning to Q3, early data paints a bright picture. The private sector PMI came in well above Q2’s average in July–August amid rising new business growth, pointing to improving private sector conditions, while easing—albeit still-high—Covid-19 infection rates since mid-August have likely provided an additional boost. Meanwhile, domestic gasoline prices hit a 10-year high in mid-September, which is likely to push up headline inflation and could weigh on consumer spending.

Kenya Economic Growth

Next year, the economy is seen growing at a solid pace, as domestic and foreign demand shrug off the pandemic’s damage, in line with rising vaccination rates globally. That said, the spread of more infectious Covid-19 variants, coupled with political uncertainty ahead of the August 2022 presidential elections, clouds the outlook. FocusEconomics analysts project GDP growth of 5.3% in 2021 and 5.4% in 2022, which is down 0.1 percentage points from last month’s forecast.

Kenya Economy Data

2015 2016 2017 2018 2019
Population (million)44.245.546.748.049.4
GDP per capita (USD)1,4331,5281,6851,8321,931
GDP (USD bn)63.369.578.788.095.3
Economic Growth (GDP, annual variation in %)5.75.94.86.35.4
Consumption (annual variation in %)-  -  -  -  -  
Investment (annual variation in %)6.6-9.28.31.32.4
Industrial Production (annual variation in %)7.35.93.85.3-  
Fiscal Balance (% of GDP)-8.1-7.7-9.0-7.0-7.6
Public Debt (% of GDP)50.254.556.059.362.1
Money (annual variation in %)14.24.27.48.05.4
Inflation Rate (CPI, annual variation in %, eop)8.06.44.55.75.8
Inflation Rate (CPI, annual variation in %)6.66.38.04.75.1
Policy Interest Rate (%)11.5010.0010.009.008.50
Exchange Rate (vs USD)102.3102.5103.2101.9101.4
Exchange Rate (vs USD, aop)98.27101.5103.4101.3102.0
Current Account (% of GDP)-6.8-4.9-6.2-4.9-5.0
Current Account Balance (USD bn)-4.3-3.4-4.9-4.3-4.7
Trade Balance (USD billion)-10.1-8.5-10.9-11.4-11.8
Exports (USD billion)5.95.75.76.15.8
Imports (USD billion)15.914.216.617.417.6
Exports (annual variation in %)-3.4-2.40.25.9-4.0
Imports (annual variation in %)-13.8-11.017.54.71.2
International Reserves (USD)7.57.67.38.29.1
External Debt (% of GDP)31.231.234.135.8-  

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Kenya Facts

Value Change Date
Bond Yield12.200.0 %Dec 31
Exchange Rate101.40.05 %Jan 01
Stock Market0.40.0 %Jan 07

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