Kenya’s economy could fare better than expected in the face of the
coronavirus crisis, thanks to growing farm exports and a recovery in
remittances, the central bank governor said on Friday.
The economy has been battered by the coronavirus, with tourism and small and medium-size businesses hit particularly hard.
But tea exports, a key source of hard currency, rose 15 per cent in May
from May a year ago, the central bank governor, Patrick Njoroge, told
an online news conference. Exports of flowers, fruits and vegetables
grew by a third the same month.
“The expectation that we were going to sink so much further has not been
borne by the numbers or the reality,” Njoroge said, although he
cautioned that the outlook remained uncertain.
“We do not want to be so foolish as to say the worst is behind us,”
Njoroge said, adding that the bank will review its economic growth
forecast in the next two weeks.
Commercial banks have restructured loans worth Sh679.6 billion ($6.39
billion), nearly a quarter of the industry total, the central bank said,
underlining the extent of the damage to the economy.
Policymakers left interest rates unchanged on Thursday for the second
time in two months, after cutting them in March and April after the
first case of COVID-19 was confirmed.
The current account deficit could narrow from the forecast of 5.8 per
cent of gross domestic product for this year, Njoroge said.
Remittances — cash sent home by Kenyans living abroad — recovered to
$258 million in May, he said, from $208 million in April. He said they
were boosted by recoveries in major economies abroad and by more ways to
send cash, including straight to the recipients’ mobile phones.
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