Kenyan Growth Beats Estimates With Fastest Expansion Since 2001
Kenyan Growth Beats Estimates With Fastest Expansion Since 2001
Kenya’s economy grew at the fastest pace in at least two decades in the second quarter, as restrictions to contain the coronavirus pandemic were eased.
Gross domestic product expanded 10.1% from a year earlier, compared with 0.7% in the three months through March, the Kenya National Bureau of Statistics said Wednesday in an emailed statement. That’s up from a low base in the second quarter of 2020 -- when a strict Covid-19 lockdown shuttered most activity -- and the highest rate since at least 2001. The median estimate of four economists in a Bloomberg survey was 5.2%.
“This performance is encouraging and signals a positive and progressive recovery from the effects of the Covid-19 pandemic on the Kenyan economy,” Treasury Secretary Ukur Yatani said in an emailed statement.
While the latest data supports forecasts that East Africa’s largest economy will rebound from its biggest contraction in almost three decades, a drought that President Uhuru Kenyatta declared a national disaster on Sept. 8 could weigh on growth. Agriculture is the biggest economic sector in Kenya, the world’s top exporter of black tea and the largest supplier of cut flowers in Europe.
The latest quarterly weather forecast by the Kenya Meteorological Department suggests most parts of the country are likely to experience below-average rainfall in the final three months of the year. Farm output contracted for a second quarter in a row, shrinking 0.9% in the three months through June.
The easing of lockdown restrictions and the lifting of a dusk-to-dawn curfew in October may offset some of the negative impact of the drought on the economy.
Kenya’s Finance Ministry expects the economy to expand at least 6% in 2021, compared with the African Development Bank’s projection of 6.3% and the International Monetary Fund’s growth estimate of 5.6%, down from 7.6% forecast in April.
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