Kenya: Growth picks up pace in Q4 2019
The economy gained traction in the final quarter of 2019, with growth accelerating to 5.5% year-on-year from the revised 5.2% in Q3 (previously reported: +5.1% year-on-year), according to Kenya’s Statistical Institute (KNBS). Taking the year as a whole, GDP growth came in at 5.4% in 2019, which was down from 2018’s 6.3%.
The fourth quarter’s upturn was largely driven by a pick-up in output growth in the all-important agricultural sector—accounting for about a third of GDP—which accelerated to 4.0% from Q3’s 2.4%. Moreover, activity in the wholesale and retail sales sector also quickened in Q4, growing 6.4% (Q3: +6.1% yoy), as did activity in the transport and storage sector, which accelerated to 9.2% (Q3: +8.1 yoy) amid low global oil prices and continued projects in the development of transportation infrastructure. Meanwhile, output in the manufacturing sector lost pace, easing to 2.3% in Q4 from 3.2% in the previous quarter, while activity in the construction sector ebbed to 5.7% (Q3: + 6.6% yoy).
Looking ahead, growth is seen slowing markedly this year as the fallout from the Covid-19 pandemic takes its toll on the economy. Global confinement measures will cripple the tourism sector and exports. Meanwhile, the threat of a second wave of locust swarms poses a further downside risk to agricultural production.