According to the latest CEO Survey by CBK, a majority of the industry leaders have identified newly introduced taxes coupled with the weakening Kenya Shilling as a threat to the country’s growth prospects.
The CEOs also highlighted high-interest rates and the rising cost of electricity as a threat to the expansion plans of their companies this year.
Other factors raising anxiety levels among corporate leaders include energy prices and global inflation, which could result in increased production costs in their firms
The CBK survey revealed 93 % of chief executive officers in the country are troubled by global inflation while 87 per cent of them have expressed concerns about high energy prices as an obstruction to their expansion plans.
“Respondents were most concerned about global inflation, high energy prices and recession fears. Agriculture sector firms were most concerned about energy prices while manufacturing and services sector firms were most concerned about global inflation and recession fears,” said CBK in the report
However, the CEOs also expressed optimism in the Kenyan Economy, buoyed by the Government’s focus on agriculture, MSMEs and building and construction sectors.
Previous concerns about the business environment eased on account of reduced fuel prices, good prospects for exports and the easing of the strict China COVID-19 controls, which is expected to ease supply chain constraints further.
The survey further expressed optimism in the business environment in Q1 2023, citing demand/orders, production volumes and sales are all expected to improve for the majority of respondents as economic conditions remain largely unchanged.
Read also; Kenya CEOs Optimistic of Rapid Recovery in Business Activity Post August Elections-CBK.