Economy grows by 4.1pc in first quarter
By KBC Reporter
Kenya’s economy grew by 4.1 percent in the first three months of this year compared to 5.2 percent during the same period last year.
The Kenya National Bureau of Statistics which attributes the slight drop in economic growth to a slow-down in the hospitality industry as well as erratic weather affected agricultural production.
Inflation on the other hand rose moderately to an average of 6.78 percent during the quarter under review compared to an average of 4.08 percent in the corresponding period of last year.
The Bureau attributes this drop to erratic weather patterns that resulted to depressed agricultural output in most parts of the country.
Nonetheless, there are sectors which performed well thus contributing to the 4.1% growth during the quarter.
These comprise transport, communication, manufacturing, wholesale, retail trade, mining and electricity.
However, despite the slowdown, KNBS says the macroeconomic environment remained relatively stable during the period under review amidst high interest rates charged by commercial banks.
The good news however is that although the month on month inflation has been slightly rising overall it has been contained and it is currently at 7.39%.
This rate of inflation is well within the government’s target of 7.5 percent.
The Kenyan shilling was also unable to withstand the pressure and so during the period under review it slightly fluctuated against major international currencies, only appreciating against the Japanese Yen and the South African Rand.
In the period under review, earnings from domestic exports declined by 5.3% to 115.4 billion shillings a drop from the 121.9 billion shillings recorded in the same period last year.
The drop has been attributed to a decrease in export earnings from Mineral fuels, Machinery and Transport Equipment, and food related products with the highest having been tea earnings which declined by 20.1%.