Kenya GDP

Economic growth eases in the fourth quarter of 2025

GDP growth hits an over-five-year low: Kenya's GDP grew 4.0% in annual terms in Q4, following a 4.8% expansion in the previous quarter. Q4's reading was the weakest since Q1 2021. In seasonally adjusted quarter-on-quarter terms, GDP grew 1.1% in Q4, following 1.2% growth in the prior quarter

Drought continues to weigh on economy: Compared to the previous period's data, readings in Q4 softened for the agricultural sector (-1.3% in annual terms vs +3.8% in Q3) and the industrial sector (+4.7% vs +5.5% in Q3). In contrast, the reading for the services sector improved in Q4 (+5.5% vs +5.0% in Q3). Looking at the details, the agricultural sector—around 25% of GDP and employing roughly 70% of the rural population—was capped by one of the driest rainy seasons on record. According to the World Health Organization, the drought has intensified malnutrition rates, heightened disease risks and disrupted access to essential health services. The industrial sector cooled as construction slowed and manufacturing expanded at the weakest pace in several years; however, mining maintained its robust streak with a fourth consecutive quarter of double-digit growth, recovering from the shrinkages seen over 2022–2024.

The war in Iran weighs on 2026 outlook: Our panelists have recently revised down their 2026 GDP growth forecasts following a weaker-than-expected Q4 2025 print and the eruption of the U.S.-Iran conflict. As a substantial net oil importer, the Kenyan economy is highly exposed to rising global prices of the commodity. Intensifying inflationary pressures hitting real incomes, plus the poor harvest season, will likely weigh on private consumption. Even so, our Consensus is for GDP growth to accelerate to a three-year high in 2026, driven by stronger expansions in fixed investment and exports of goods and services. Investment, in particular, will be buttressed by cheaper borrowing costs and large infrastructure projects, like the extension of the railway to the Ugandan border, whose construction restarted in March 2026 after a six-year delay.

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Kenyan GDP projections for the next ten years from a panel of 17 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable GDP forecast available for Kenyan GDP.

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