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Kenya National Bureau of Statistics Economic Survey

27th Jan, 2016

 The economy grew by 5.3 per cent last year, a dip from the 5.7 per cent recorded in 2013, after the country took a hit from a decline in tourism earnings and a sluggish manufacturing sector.

This is expected to have negative bearings on the Government’s ambitious plan to raise spending by 25 percent to Sh2.17 trillion in the next financial year.

Already, the taxman is struggling to meet revenue targets from the country’s jewel sectors of agriculture, manufacturing and tourism, whose growth is pointing south.

Data released by the Kenya National Bureau of Statistics (KNBS) in its Economic Survey 2015 confirmed predictions of a slowdown, caused in part by a drop in the number of tourists visiting Kenya and a slump in output linked to the manufacturing sector.

Neighbouring countries Tanzania and Rwanda grew faster than Kenya, posting 7.2 per cent and 6.0 percent growth rates respectively. The output in the country’s real sector, which is concerned with producing goods and services, slowed down from 5.6 per cent in 2013 to 3.4 per cent last year, with the modern sector creating 30,000 less jobs.

Further, the number of international visitor arrivals dropped 11.1 per cent from 1.5 million to 1.3 million, and with this, tourism earnings dropped 7.3 per cent from Sh94 billion to Sh87.1 billion. The dip in economic growth has been worsened by a rise in the cost of living. The statistics released in May show that the cost of living grew from 5.7 per cent to 6.9 percent in 2014. This means that Kenyans used more money to buy the same quantity of goods and services than they did a year earlier.

According to the survey, the growth from the demand side was driven mainly by an increase in private consumption and rapid growth in capital investment. From the supply side, the major drivers of the economy were agriculture, forestry and fishing, construction, wholesale and retail trade, education and finance, and insurance.

However, the accommodation and food services sector contracted for the second year in a row. The number of persons employed outside small-scale agriculture and pastoralist activities rose from 13.5 million to 14.3 million.

The economy gave rise to 799,700 new jobs, representing a 5.9 percent growth. However, the modern sector generated about 27,900 less jobs than it did a year earlier. The report says new jobs created in the modern or information age sector declined from 134,200 to 106,300 in 2014. The economy gave rise to 799,700 new jobs, representing a 5.9 per cent growth.

However, the modern sector generated about 27,900 less jobs than it did a year earlier. The report says new jobs created in the modern or information age sector declined from 134,200 to 106,300 in 2014. “This deceleration was mainly due to the decreased activities in the agricultural sector and reduced absorption of employees in the counties,” the report notes. The informal sector had the largest share of employment, accounting for 82.7 per cent of total jobs in the country. In the energy sector, the total quantity of imported petroleum products grew by 11.7 percent to 4.4 million metric tonnes, while customers connected under the rural electrification programme expanded by 16.5 per cent to 528,552.

In addition, the report informs budgeting, planning, monitoring and policy formulation. The data used to compile the report is collected through administrative records, statistical surveys and censuses.

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