Treasury projects higher growth in second half

National Treasury Cabinet secretary Henry Rotich. FILE

By GEOFFREY IRUNGU

IN SUMMARY
Treasury secretary Henry Rotich said last Friday that growth was projected to be 5.5 per cent this year.
The growth will be powered by stronger performance in the agricultural and services sectors as well as economic reforms.

The Treasury projects a higher economic growth in the second half of this year compared to the first half when the gross domestic product (GDP) grew by 4.7 per cent.

Treasury secretary Henry Rotich said last Friday that growth was projected to be 5.5 per cent this year, powered by stronger performance in the agricultural and services sectors as well as economic reforms.

Such expansion would require the economy to grow by 6.2 per cent in the second half of the year to bring the total GDP for the year at constant market prices to Sh1.7 trillion from last year’s Sh1.61 trillion.

In the first quarter of the year, GDP growth stood at 5.2 per cent, but this went down to 4.3 per cent in the second quarter, with the total economic expansion for the half year rising higher by 0.4 percentage points than in the same half in the previous year.

“We are still optimistic we will hit 5.5 per cent in GDP growth this year. We achieved 4.7 per cent in the first half of the year and we know that we will attain a higher growth in the second half than in the first,” said Mr Rotich.

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The 4.3 per cent growth in the second quarter of this year was flat relative to the 4.4 per cent in the first quarter, due to what KNBS explained as slowdown in the tourism sector, due to jitters linked to the last General Election.

Mr Rotich was responding to a query from the Business Daily shortly after signing a Sh1.7 billion loan agreement with the Belgian ambassador to Kenya Bart Ouvry at the Treasury offices in Nairobi on Friday.

The loan is intended for a water project in Elgeyo Marakwet County to supply drinking water to Iten, Tambach and the surrounding areas.

It involves the construction of a dam on the river Charama, a purification station and more than 23-kilometre pipeline.