Kenya’s national treasury sees the Kenyan economy expanding at 6.4% in 2021, after a historically low growth rate of 0.6% in 2020 as per government estimates.
Treasury says the economic recovery in 2021 will be driven by the stable macroeconomic environment, the ongoing public investments in infrastructure projects, the Economic Stimulus Program, the post-Covid-19 Economic Recovery Strategy, and improved trade as nations recover from the covid19 linked downturn says the national treasury.
According to the draft 2021 budget policy statement, Kenya has taken measures to “stimulate economic growth, promote job creation, reduce poverty, protect the vulnerable groups and businesses.”
Even with the positive outlook, GDP growth is expected to slow down in 2022 to 5.5% due to the election-related uncertainty.
Government expects revenue collection to grow by 9% to KSh 1.829 Trillion at the end of the fiscal year 2020/2021, from KSh1.675 trillion collected at the end of fiscal year 2019/2020. Total revenue collection reached KSh 800.1 billion in the first half of fiscal year 2020/2021 that ended on 31st December 2020, below government’s target of KSh 907.7 billion.
“Revenues are expected to progressively improve in the second half of the fiscal year following the gradual reopening of the economy and the increased demand for imports as well as improved domestic sales. Revenue performance is also expected to get a boost from the reversal of tax reliefs, introduced in April 2020, effective January 2021,” reads the budget policy statement issued by treasury.
READ;
Kenya’s Economy Shrinks by 5.7% in 2020 Q2 as Pandemic Hits Key Sectors
Kenya’s Economy to Grow Fastest in Africa in 2021 -World Bank
