The Government has revised Kenya’s economic growth rate at between 5.0 and 5.1% this year citing effects of the drought experienced at the start of the year coupled with the prolonged electioneering period; but remains confident that it will rebound in 2018.
Speaking to journalists in Nairobi, National Treasury Cabinet Secretary, Henry Rotich said he expects the economy to withstand anticipated election shocks to post an economic growth rate of between 5.0% and 5.1% owing to a largely stable macro-economic environment in the country.
This has been buttressed by the country’s lowered rate of inflation which dropped to 5.72% during the month of October, on the back of improved weather conditions that have led to reduced cost of foodstuffs.
“We are forecasting economic growth to steadily grow at between 5.0% and 5.1% for the remainder of the year in view of the prevailing economic conditions in the country; and in defiance of the poll jitters that have characterized the sector for the last four months,” he said.
The country’s economic outlook was earlier in the year adjusted downwards from the projected 5.7% to 6.0% growth owing to unfavourable weather conditions that drove up the rate of inflation.
The revised outlook for the remainder of the year is, however, on target owing to the 5.0% growth experienced during the second quarter of the year.
Commenting on the effect the elections has had on the economy, CS Rotich said:
“Overall, we estimate that the country has lost an estimated 1% of the GDP during the electioneering period; or between KES 120 and KES 130 billion in actual figures. This is evident in the revised growth outlook for the rest of the year.”
CS Rotich further added that the Government is considering engaging investors in the international capital markets as an option of meeting demands to fund infrastructure projects and to mitigate the loss the country has experienced over the electioneering period; adding that the conversation was still at a very early stage.
Speaking at the same occasion, Industry, Trade and Cooperatives Cabinet Secretary, Adan Mohammed, expressed confidence that international trade would pick up immediately the electioneering period is over – a move that will further boost economic growth through the trickle-down effect that will result from new businesses setting up in the country.