Suppressed economic growth to pick up this year, Treasury CS

Economic growth slowed last year suppressed by violent elections, drought and slow credit growth to the private sector.

According to the Kenya National Bureau of Statistics, the gross domestic product increased 4.9 percent, down from 5.85 percent in 2016.

Treasury Cabinet Secretary Henry Rotich says growth momentum will pick in 2018 with the economy growing by 5.8 percent.

The 2018 Economic Report shows that growth in financial services slowed to 3.1 percent blamed on the interest rates capping law which came into force in the last quarter of 2016.

Rotich says the Treasury has drafted new proposals to the National Assembly to change the law.

The Report indicates that output was sluggish in 2017 at 0.2 percent from 2.7 percent in the previous year, while construction decelerated to 8.6 percent from 9.8 percent in 2016 as investors adopted a wait and see mode due to violence that engulfed the presidential election.

The agriculture sector expanded by 1.6 percent due to the dry spell that the country experienced in the first and second quarter of 2017.

However, the sector is expected to register improved growth this year due to favorable weather.

Tourism was a bright spot after growing almost 15 percent. The sector’s earnings increased 20 percent to 120 billion shillings with the number of visitors increasing by 8.1 percent to 1.5 million in 2017.

Total cargo handled through the port of Mombasa increased by 10.6 percent to 30 million tons in 2017. In the year under focus the economy created 900 thousand jobs with more than 80 percent of the jobs in the informal sector.

The government expects the economic activity to pick up this year, pushing growth to an estimated 5.8 percent, and 7 percent in the next three to five years.

 

 

  

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