Government projects 5.8pc economic growth

By O’Brien Kimani

National Treasury Cabinet Secretary Henry Rotich (FILE)

The government projects that Kenya’s economic growth will surpass the 5.8 percent growth target despite the heightened political environment and less favorable weather.

National Treasury Cabinet Secretary Henry Rotich says that growth will be driven by improved absorption capacity at the county government level and the planned expenditure of the Eurobond cash.

He was meeting South Korean deputy minister for political affairs.

East Africa’s largest economy is through a rough patch due to erratic weather, insecurity and heightened political environment.

But poor weather and the insecurity are the biggest concern for the economy. The two have been listed as major factors that led to the drop in Kenya’s GDP growth from 5.2 percent in the first quarter of 2013 to 4.1 percent during the same period this year.

Rotich says the government has started utilizing the Eurobond funds which is expected to stimulate economic activity and create jobs.

Among the areas targeted for a slice of the 175 billion shillings bonds include, the expansion of the Mombasa port, geothermal development and agriculture.

National Treasury is expected to release details of how the Eurobond funds will be spent in the coming months.

Kenya and South Korea Tuesday signed a new development co-operation agreement which will see the South Asian nation step up its funding for various roads and educational projects in Kenya.