Publication: Continued Rebound, but Storms Cloud the Horizon: Policies to Accelerate the Productive Economy for Inclusive Growth
Date
2022-12
ISSN
Published
2022-12
Author(s)
World Bank
Abstract
Kenya’s rebound from the pandemic
continued in 2022. Driven by broad-based increases in
services and industry, real Gross Domestic Product (GDP)
increased by 6.0 percent Year-on-Year (y/y) in the first
half (H1) of 2022. However, the agriculture sector
contracted by 1.5 percent during thesame period, and with
the sector contributing almost one fifth of GDP, its poor
performance pulled back GDP growth by 0.3 percentage points.
Notwithstanding the strong y/y creases, GDP has seen a
marked sequential slowdown since the 2021 third quarter (Q3)
as base effect dissipatedand business confidence weakened
because of the global commodity market shock, a long
regional drought and domestic political uncertainty in the
run up to the August 2022 general elections. Business
confidence however picked up in the wake of a smooth
transition of power following a largely peaceful
presidential election. Kenya’s growth prospects remain
bright; however, emerging shocks are challenging the
broad-based rebound. Thebaseline assumes robust growth of
credit to private sector, contained COVID-19 infections, and
high commodity prices favorable for Kenyan exports to boost
Kenya’s growth in the medium term. However, the ongoing
shocks, including the long drought in arid and semi-arid
areas, rising inflation,and tighter global financial
conditions, create challenges for Kenya to sustain its recovery.
Citation
“World Bank. 2022. Continued Rebound, but Storms Cloud the Horizon : Policies to Accelerate the Productive Economy for Inclusive Growth. Kenya Economic Update;No.26. © Washington, DC: World Bank. http://openknowledge.worldbank.org/handle/10986/38386 License: CC BY 3.0 IGO.”