Kenya’s economy is expected to expand by 6.1 percent in 2019 up from 6.0 percent in 2018.
The International Monetary Fund (IMF) has however warned that this growth is under threat due to high debt levels and inflationary pressures.
In its regional economic outlook report, the fund is advising the Kenyan government to lower its appetite for debts, by expanding the tax base and reduce the tax deficit to below 7 percent of GDP in the current financial year.
IMF says the 6.1 percent economic growth is facing severe internal and external shocks which the government needs to address fast.
On the external front, rising fuel prices that has peaked to above 80 dollars a barrel, is likely to trigger another round of fuel price increase adjustment in Kenya.
Already the country is reeling from the re-introduction of value added tax on fuel which came into force last month.
The IMF quarterly regional economic report warns that Kenya should brace for higher consumer prices fuelled by adverse weather and an increase in fuel prices.
The fund is projecting that Consumer Price Index will rise 5.0 in 2018 to 5.6 in 2019.
Economic growth will also peak from 6.0 this year to 6.1 percent in 2019.
However, this growth is facing various challenges like current account deficit and high debt which currently stands 56.1 percent of GDP.
IMF has further downgraded the global growth from 3.9 percent in 2018 and 2019 to 3.7 percent.
Growth in Sub-Saharan African is expected to increase from 2.7 percent in 2017 to 3.1 percent in 2018, reflecting domestic policy adjustments and a supportive external environment, including continued steady growth in the global economy, higher commodity prices, and accommodative external financing conditions IMF has said.