MENU
 Registered users can save articles to their personal articles list. Login here or sign up here
 Registered users can save articles to their personal articles list. Login here or sign up here

Kenya’s economy grew 5.8% in 2016, missing forecasts

Recovery in tourism industry boosts other sectors of economy.

NAIROBI – Kenya’s economy grew 5.8% last year, just above 5.7% growth the previous year but still slightly short of forecasts, the statistics office said on Wednesday.

Government officials in the East African nation, which holds a general election in August, initially estimated the economy to have expanded by 5.9%.

A recovery in tourism, boosted the number but other sectors, such as farming and the construction sector grew at a slower rate, the director general of the Kenya National Bureau of Statistics, Zachary Mwangi, said.

“The tourism sector had a remarkable recovery as it benefited from improved security,” he said at the launch of the annual economic survey.

He said the main risks facing economic growth this year were internal, after an acute drought depressed output in the first quarter and drove up food prices.

“Key crop growing regions are expected to receive late and inadequate rains,” Mwangi said.

Farming, including exports of tea and coffee, accounts for more than a quarter of annual output in the region’s largest economy.

Most experts expect the economic expansion to slow down this year due to the drought and sluggish private sector credit growth. The World Bank said last week the economy is likely to grow by 5.5% in 2017.

The shilling was expected to be stable this year, Mwangi said, attributing it to solid foreign exchange reserves held by the central bank and a sustainable current account deficit.

The data released on Wednesday showed the current account deficit narrowed 11.9% last year to 5.2% of GDP. The overall balance of payments swung to a small surplus last year from a deficit in the previous year.

In the tourism sector, visitor numbers rose to 1.34 million from 1.18 million the prior year, with earnings rising 17.8% to 99.7 billion shillings ($964.68 million), Mwangi said. Hotel room occupancy also rose.

The information, communication and technology sector also grew at a faster pace, Mwangi said, thanks to growth in the number of mobile phone users and Internet subscriptions.

More stories from Moneyweb
Peter Nurcombe-Thorne

Peter Nurcombe-Thorne

Rosebank Wealth Group (Pty) Ltd
Moneyweb Click an Advisor
   No comments so far

To comment, you must be registered and logged in.

LOGIN HERE

Don't have an account?
Sign up here

Latest Currencies

ZAR / USD
ZAR / GBP
ZAR / Euro

MONEYWEB NEWSLETTERS

Subscribe to our mailing list

* indicates required
Moneyweb newsletters

Podcasts

Moneyweb Investor Issue 25

If the world's best investment managers, who came together at a recent CFA conference, cannot figure whether a crash or correction is looming, ordinary investors can be forgiven for their hesitation. Thus the June issue of The Moneyweb Investor does its best to fill the gaps. With 17 stories and a podcast, you wouldn't want to miss it.

Follow us:

Search Articles:Advanced Search
Click a Company:
server: 172.17.0.2