The Kenya National Bureau of Statistics has released the Economic Survey 2026, the country's annual self-portrait, covering calendar year 2025.
It is dense, comprehensive, and full of numbers most people will never read.
This article does the work for you: 35 things from the report worth knowing, what they actually mean, and why you should care.
Five things to take away before you go any further
- •Kenya grew 4.6% in 2025, slower than every East African neighbour except Somalia and the DRC. The EAC bloc averaged 5.6%; we grew below it. The neighbourhood is moving faster than we are, and the gap is no longer a rounding error.
- •Inflation is tamed, the shilling appreciated, and the NSE-20 jumped 56% in twelve months. Yes, really. The macro environment improved meaningfully in 2025, even if it does not always feel that way at the till.
- •Public debt now sits at KSh 11.4 trillion. Interest payments alone (KSh 851bn in 2025/26) exceed the entire budgets for health, county transfers, and housing combined. Debt service has quietly become the single largest line in government, and that has consequences nobody campaigns on.
- •83.8% of Kenyans who work, work informally. Total formal jobs reached 3.31 million; informal employment stands at 18.1 million. The "modern sector" story, the one that fills KNBS tables, is roughly one in six working Kenyans.
- •The Central Bank cut rates aggressively, but lending rates barely moved in proportion. CBR fell from 11.25% to 9.00%; commercial bank lending rates fell only from 16.89% to 14.82%. The transmission mechanism is leaking, and someone is keeping the difference.
Growth, scale, and the neighbourhood
- •Kenya's economy is now KSh 17.6 trillion (US$ 136 billion.
That makes us the fourth-largest in Sub-Saharan Africa, behind South Africa ($426bn), Nigeria ($285bn), and ahead of Ethiopia ($109bn). The list itself is more interesting than the ranking. Africa's largest economy grew under 1% last year; the second-largest just exited recession. Being a tier below them is a much smaller honour than it used to be.
2. We grew at 4.6%, the slowest year since the pandemic recovery.
The trend tells the story: 7.6% in 2021, 4.9% in 2022, 5.7% in 2023, 4.7% in 2024, 4.6% in 2025. Strip out the COVID rebound and we are running flat at just under 5%. That appears to be the economy's natural growth rate at the moment, and natural is not the same as adequate. Vision 2030 needs closer to 7%.
3. Within the EAC, only Somalia (3.0%) and the DRC (2.7%) grew slower than Kenya.
Rwanda hit 7.1%. Uganda 6.4%. Tanzania 6.0%. Burundi 5.3%. The bloc averaged 5.6%. Kenya, the EAC's largest economy, came seventh of eight. There is no single explanation, but persistent fiscal tightening, anaemic private credit, and a weather-bruised agriculture sector all played a part.
4. GDP per capita crept to about $2,549, up from roughly $2,400 the year before.
This sounds like progress, and on paper it is. But the population grew at 1.7% and inflation ate 4.1%. By the KNBS real-wage index (June 2009 = 100), real wages now sit at 85.84. That means the average Kenyan formal-sector worker is, in inflation-adjusted terms, poorer today than they were in 2009. That is the headline you don't see on the headline.
5. Services now make up 55% of GDP, agriculture 23.2%, industry 16.3%.
Kenya has quietly become a services economy, structurally closer to a small Western country than to a typical African one. That is both an opportunity and a problem. Services create jobs, but they create few jobs that absorb low-skilled rural-to-urban labour at scale. Manufacturing's share has been drifting down for over a decade, and that drift is now central to the youth-employment story.
Inflation, prices, and the shilling
6. Headline inflation came in at 4.1%, the lowest in five years.
For context, this is below the centre of the Central Bank of Kenya's 5% medium-term target band for the first time in years. Globally, inflation also eased to 4.1%. EAC inflation, by contrast, rose to 4.4%. Kenya is now an inflation outlier in its own region, in a good way.
7. But "average inflation" hides a brutal split inside the food basket.
Fish prices rose 16%. Vegetables, tubers, plantains, cooking bananas and pulses jumped 13.4%. Oils and fats rose 4.1%. Sugar 3.2%. Cereals 2.4%. Dairy actually fell 0.5%. The Kenyan kitchen, especially the urban low-income kitchen that leans on sukuma, ugali, and pulses, did not feel a 4.1% inflation year. It felt closer to double that.
8. The shilling appreciated against the dollar, from KSh 134.8 to KSh 129.3.
This is a small but meaningful reversal of the depreciation cycle that ran from 2022 to mid-2024. Stronger reserves, lower oil import bills, sustained remittance inflows, and a more orderly debt rollover schedule all helped. A stronger shilling is a quiet win for importers and inflation, and a quiet headache for exporters whose costs are local but whose revenues are increasingly squeezed.
9. Diaspora remittances reached KSh 661 billion in 2025.
That is more than total domestic exports of goods (KSh 968bn) once you adjust for re-exports, and far more than tourism earnings or any single export category. The Kenyan diaspora is now the country's most reliable foreign-exchange earner. No tea, coffee, or flower compares.
Jobs, wages, and the informal sector
10. The "modern sector" added about 101,000 jobs in 2025.
Total formal employment, excluding self-employment, reached 3.315 million, growing 3.1%. Set that against population growth of 1.7% and a much higher rate of new labour-force entrants. The arithmetic still does not work for the median young Kenyan looking for waged employment.
11. Informal employment now stands at 18.1 million people, or 83.8% of all jobs.
The KNBS pie chart on this is one of the most consequential charts in the report. Five out of every six Kenyans who work, work without contracts, payslips, or formal benefits. That, not the formal sector, is the actual labour market.
12. The public sector hired faster than the private sector.
Public sector formal jobs grew 4.6%; private sector jobs grew only 2.5%. In absolute numbers, government added about 47,000 formal jobs while private firms added about 55,000. For an economy that needs private-led job creation, this is a quiet warning sign.
13. Manufacturing, education, retail, agriculture, and construction are the big formal employers.
Manufacturing leads at 366,600 jobs, then agriculture and forestry at 311,800, retail at 281,000, education at 251,100, and construction at 228,200. Education at a quarter of a million confirms what every Kenyan parent already knew: schools are now one of the country's largest formal labour markets.
Money, banks, and credit
14. The Central Bank Rate fell from 11.25% to 9.00% in 2025.
That is one of the most aggressive easing cycles CBK has run in years, broadly tracking the easing trajectories at the Federal Reserve and ECB. The intention was to revive private credit growth, which had been crushed by the prior tightening cycle.
15. Commercial bank lending rates fell only from 16.89% to 14.82%.
A 2.25-percentage-point CBR cut translated into a 2.07-percentage-point retail rate cut. On paper, that is reasonable transmission. In practice, the spread between what banks pay for funds and what they charge borrowers remains uncomfortably wide. Kenyan banking margins are high by emerging-market standards, and the policy rate alone cannot close them.
16. Domestic credit reached KSh 7.86 trillion. Private sector got 64.9%; the National Government got 34.2%.
This is the crowding-out story in a single number. For every shilling of credit in the system, more than a third now goes to fund the government. Counties get 0.2%; public non-financial corporations 0.2%; other financial corporations 0.5%. Private companies are competing for credit with an enormous, price-insensitive borrower.
17. The NSE-20 Share Index rose from 2,011 to 3,139, a 56% gain in twelve months.
This is genuinely big news, and it received a fraction of the attention it deserved. After years of grinding underperformance, the Nairobi Securities Exchange rallied hard on stronger banks, a Safaricom recovery, and renewed foreign portfolio interest. A rising stock market is not the same as a rising economy, but it is also not nothing.
18. Bank deposits grew 10.1%; bank assets grew 10.8%.
Kenyan banks expanded balance sheets faster than nominal GDP. That, combined with the high spreads, helps explain why Kenyan listed banks remain among the most profitable in Africa. It also explains why credit reform never quite happens: the people best placed to lobby for it are the ones who benefit from the current setup.
Public finance and debt
19. Public debt now stands at KSh 11.4 trillion. KSh 5.4tn domestic, KSh 6.0tn external.
That is roughly 65% of GDP. The level matters less than the composition: external debt is now the larger half, which means a chunk of debt service is dollar-denominated and currency-sensitive. A weaker shilling next year would feed straight into this number.
20. The single largest line in the 2025/26 budget is interest on debt: KSh 851 billion.
Education comes second at KSh 787bn. General Public Services third at KSh 612bn. Economic Affairs at KSh 607bn. Health, the supposed cornerstone of universal coverage, gets KSh 151bn. We now spend more servicing past borrowing than running the entire health system, more than five times over.
21. The fiscal deficit narrowed from 6.8% of GDP to 5.0%.
This is real and meaningful. After years of slippage against IMF programme targets, the Treasury finally compressed the deficit. The mechanism was less heroic than the headline: ordinary revenue rose to 19.0% of GDP from 17.1%, driven mainly by tax measures from the 2023 and 2024 Finance Acts, while expenditure was held just below growth.
22. Ordinary revenue jumped to KSh 3.38 trillion, up from KSh 2.93 trillion.
Tax revenue makes up 79% of that total, non-tax 20%, grants just 1%. Kenya is now a country that funds itself, with marginal donor support. That is a long-run achievement, but it has come at the price of a tax burden that increasingly squeezes the same formal sector that delivers most of the revenue. You cannot tax 18 million informal workers; you can only tax the 3.3 million formal ones harder.
23. External debt service ate 31.1% of exports of goods and services.
Up from 21.2% the year before. This is the legacy Eurobond maturity story arriving on the ledger. The IMF generally treats anything above 25% as elevated. Kenya is now in elevated territory, which constrains what the National Treasury can do without a new round of refinancing.
24. County governments will receive KSh 543.9 billion in 2025/26.
KSh 405.1bn equitable share, KSh 39.1bn conditional grants, KSh 99.7bn own-source revenue. Counties have, very slowly, become real fiscal entities. Own-source revenue at 18% of total county revenue is still low, but it is directionally improving.
Trade and the external sector
25. The trade deficit widened to KSh 1.65 trillion.
Imports (KSh 2.77tn) still dwarf exports (KSh 968bn). The trade balance worsened despite a stronger shilling, which tells you the import bill is structural, not just price-driven. Industrial machinery, vehicles, iron and steel: this is the cost of an economy trying to invest its way to higher productivity.
26. Top imports: petroleum (KSh 511bn), industrial machinery (KSh 390bn), fats and oils (KSh 159bn), iron and steel (KSh 132bn), motor vehicles (KSh 132bn).
Even after the shilling rallied, oil remained the single largest import, costing roughly half a trillion shillings. Until East Africa solves its energy import dependency, every barrel of Brent above $80 is felt at the Kenyan pump within weeks. The fats-and-oils import bill, mostly palm oil, is a smaller version of the same story.
27. Top exports: tea (KSh 187bn), cut flowers (KSh 103bn), vegetables and fruits (KSh 100bn), apparel (KSh 63bn), unroasted coffee (KSh 52bn).
Notice the structure: four out of five top exports are agricultural, and three are climate-sensitive. Apparel, the only manufactured export in the top five, exists largely because of AGOA preferences, the future of which is no longer guaranteed.
28. China sold us KSh 671bn worth of goods. We sold China nothing comparable in return.
The bilateral trade gap with China is the single largest external imbalance in the survey. UAE, India, Saudi Arabia and Pakistan also run large surpluses with us. Africa, by contrast, is where Kenyan exports actually thrive: Uganda alone bought KSh 162bn of our products, more than any non-African country. Our regional integration is not theoretical; it is already paying.
Sectors: the texture of growth
29. Agriculture grew 2.8%, down from 4.3% the year before.
The sub-numbers tell the weather story: maize +2.2%, rice +6.4%, horticulture +13.8%, milk +3.5%. But wheat fell 18.2%, tea 7.8%, sugarcane 24.7%. Below-average short rains hit rain-fed crops; tea suffered from both weather and a softer global market; sugarcane is now structurally distressed. Half a century after independence, Kenyan growth still moves with the rain gauge.
30. Manufacturing grew just 2.0%, the weakest in five years.
Sugar manufacturing collapsed 24.8%, in lockstep with the cane crop. Cement consumption surged about 20%, suggesting that construction-led demand is alive, but value-added manufacturing is not capturing it. Vehicles assembled rose to 13,692 units. EPZ employment of locals hit 104,692, partly thanks to AGOA apparel, which remains a real bright spot.
31. Construction is the surprise of the year.
Cement consumption jumped from 8,543 to 10,280 thousand metric tonnes, a level last seen before 2022. Government housing expenditure leapt from KSh 79bn to KSh 117bn. The Affordable Housing Programme, controversial as it is, is now actually building things at scale. Whether the units find buyers at advertised prices is a 2026 question.
32. Tourism cleared 2.55 million arrivals, 6.2% growth, with 47.8% on holiday.
Domestic tourism is the quiet hero: 45% of hotel bed-nights in 2025 were occupied by Kenyans. African visitors topped the departing-visitor list at 588,800, more than Europe (477,500). The "African tourism market" is no longer a slide in a strategy deck; it is the largest single segment in our hotels.
33. Geothermal generated 5,982 GWh, 40% of all electricity.
Add hydro (3,462 GWh) and the renewable share of generation comfortably clears 75% in a typical year. Kenya's grid is one of the cleanest in the developing world, a fact that should sit at the centre of every industrial policy conversation, and rarely does. If there is a sustainable competitive advantage in this country, it is sleeping in the Rift Valley.
Digital, transport, and the rest
34. Mobile money moved KSh 21.34 trillion in 2025.
That is bigger than nominal GDP. 51.4 million subscribers, 501,399 agents, 2.7 billion transactions. The mobile money rails are now denser than the formal banking system by every meaningful measure. They are also the single most important reason Kenya is consistently ranked above its income level on financial inclusion.
35. New vehicle and motorcycle registrations almost doubled to 395,235 units.
Motorcycles drove the jump, from 118,308 to 241,763. The boda boda economy is back in growth mode after two flat years. Whether that is good news depends on whom you ask: it employs hundreds of thousands of young men, and it accounted for a meaningful share of the 5,009 road fatalities and 19,896 injuries recorded in 2025. Mobility, employment, and risk are bundled into the same chassis.
What to watch next
The fiscal trajectory. The deficit narrowed in 2025/26, but external debt service is now eating one in three shillings of export earnings. The 2027 Eurobond maturity wall is closer than it looks. Expect another refinancing exercise, probably with IMF support, before the end of the financial year.
The CBR transmission gap. If lending rates remain stuck above 14% while the policy rate sits near 9%, the case for structural banking reform will get louder. The political space for that conversation depends on credit growth in 2026; if private credit fails to recover, the conversation moves from technical to populist.
Agricultural weather. Kenya's growth still moves with the rains. The October-to-December 2025 short rains underperformed; the long rains of 2026 will determine whether agriculture recovers above 4% or whether we settle into a 2-3% trend that drags down the headline.
Manufacturing's quiet decline. A 2.0% growth print is too low for an economy of Kenya's size and stage. Without industrial revival, the youth employment problem cannot be solved by services alone, and the structural trade deficit cannot be closed by exporting more flowers and coffee.
The 2027 election cycle. The 2025/26 fiscal year is the last "clean" budget before politics intrudes. Expect spending pressures to build through the second half of 2026, particularly on housing, road works, and county-level transfers. Whether the deficit can stay near 5% of GDP through an election year is the question.
A closing thought
The 2026 Economic Survey is a study in cognitive dissonance. The macro story improved: lower inflation, a stronger shilling, a recovering stock market, a narrower deficit, a calmer central bank. The micro story did not. Real wages are still below 2009 levels. Five out of six workers are informal. Manufacturing is shrinking as a share of the economy. The neighbourhood is growing faster than we are.
A serious country reads both stories together. The macro stability is a window, not a destination. What we do with the window, whether we use it to fix the broken transmission between policy rates and lending rates, between formal jobs and the people who need them, between cheap geothermal and an industrial base that could plausibly compete, is the actual conversation worth having in 2026.
The numbers are KNBS's. The interpretation is ours. Both are worth your attention.
Sources: Kenya National Bureau of Statistics, Economic Survey 2026 (Popular Version) and the underlying Economic Survey 2026, released April 2026. International comparators from the IMF World Economic Outlook (October 2025), as cited in the KNBS report. Banking and monetary data cross-referenced with the Central Bank of Kenya.
