The Kenya National Bureau of Statistics (KNBS) during the week released Q1 2016 GDP numbers marking a 5.9% year on year growth in GDP compared to a 4.9% and 6.2% growth in Q1 2015 and Q4 2015 respectively.
Growth was supported by improved growths in accommodation and food services (+12%), Agriculture, forestry and fishing (+4.8%), transport and storage (+8.4%) and mining and quarrying (+6.9%).
In the agriculture sector, which accounted for 30% of GDP in 2015, growth was mainly supported by a recovery in tea production from a contraction of 27.2% in 1Q15 to record a substantial growth of 71.1% owing to favourable weather conditions.In addition, improved international prices led the value of exports of coffee and tea to increase by 7.6% and 24.5% respectively.
Despite a considerable drop in international oil prices, the manufacturing sector registered a slow growth of 3.6%y/y in 1Q16 – the slowest growth since 2013.
Performance was dampened by a decline in the manufacture of soft drinks, maize & wheat flour, textiles (-22%y/y) and clothing (-8.8%y/y) and assembly of vehicles (-35.3%y/y).
Growth in construction sector slowed down to 9.9% from 12.6% in 1Q15 evidenced by the production and consumption of cement whose growths slowed to 5.2% and 8.3% during the quarter compared to expansions of 11.0% and 17.0% in 1Q15.
The current account balance improved by 30.1% from a deficit of KES 101,539m in 1Q15 to a deficit of KES 71,018 m. Overall balance of payments improved to a surplus of KES 26,318 m from a deficit of KES 17,063m.
(Kenya National Bureau of Statistics, Standard Investment Bank & Kenyan Wallstreet)
