SUMMARY
- CBK has projected the economy to grow by 6.1 percent this year and 5.6 per cent in 2022, backed by recovery in manufacturing, trade and hospitality sectors, and despite expected decline in agriculture production.
- CBK governor Patrick Njoroge said Wednesday that economic indicators around the manufacturing, trade, accommodation and power consumption are pointing to improved economic performance.
The Central Bank of Kenya (CBK) has projected the economy to grow by 6.1 percent this year and 5.6 per cent in 2022, backed by recovery in manufacturing, trade and hospitality sectors, and despite expected decline in agriculture production.
CBK governor Patrick Njoroge said Wednesday that economic indicators around the manufacturing, trade, accommodation and power consumption are pointing to improved economic performance, while there is also high optimism among banks and private sector players over the prospects for growth.
He however said the impact of drought will dampen growth in the key agriculture sector, which grew at 5.4 per cent last year and is the biggest contributor to Kenya’s GDP at 23 per cent.
“The one sector to flag is agriculture, which remains most uncertain because of rains. There has been a drought warning that has gone out and this will be a large driver…and therefore we are projecting its growth at 2.6 per cent,” said Dr Njoroge.
The CBK growth projection for this year is slightly higher than the National Treasury’s six per cent and the World Bank’s 4.5 per cent.
This will be a major rebound from the contraction of 0.3 per cent recorded in 2020, when restrictions meant to control the Covid menace caused negative growth in the second and third quarters of the year.
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