- The lender had projected the country’s GDP growth at 5.5 per cent last year.
- Further projects the growth prospects to consolidate at 6.0 per cent next year.
The African Development Bank projects Kenya's economy will grow at a pace of 5.6 per cent this year, an upward projection from last year.
The lender further projects the country’s GDP growth to consolidate at 6.0 per cent next year.
The lender had placed the country’s GDP growth at 5.5 per cent last year, after a downgrade from 7.5 per cent tin 2021.
In its latest regional economic outlook dubbed ‘Mobilising private sector financing for climate and green growth in Africa’, the continental lender attributes the latest forecast to fairly diversified production structures and a decline in commodity prices.
“Kenya, just like other countries in the East Africa region are commodity importers, and lower prices would benefit its GDP growth,” the lender says.
It however notes that pockets of drought and insecurity remain and may pose a challenge to achieving the projected higher growth.
Growth for the East African region is also projected to strengthen from 4.4 per cent in 2022 to 5.1 per cent this year and 5.8 per cent in 2024.
“With the exception of South Sudan, growth in all countries in this region is estimated to increase, with seven of them achieving 5 per cent GDP growth or higher,” AfDB says.
Rwanda has been projected to top the region's growth this year, at 7.6 per cent, followed by Uganda at 6.5 per cent with Ethiopia coming in third at 5.8 per cent.
Kenya and Tanzania close in the fourth and fifth positions at 5.6 and 5.3 per cent, respectively.
Africa's general economy has also been projected to be resilient amidst multiple shocks.
Its average growth is projected to stabilise at 4.1 per cent in 2023–24, higher than the estimated 3.8 per cent in 2022, down from 4.8 per cent in 2021.
The growth slowdown last year was attributed mainly to the tightening global financial conditions and supply chain disruptions exacerbated by Russia’s invasion of Ukraine.
The residual effects of the Covid-19 pandemic and the growing impact of climate change and extreme weather events also impaired growth, the lender says.
It however says the continent’s growth is projected to rebound to four per cent this year and consolidate at 4.3 per cent in 2024, underpinning the continent's continued resilience to shocks.
“This is mainly underpinned by China’s re-opening and slower pace of interest rate adjustments," said AfDB.
However in notes that despite this, climate change, elevated global inflation, and persistent fragilities in supply chains will remain on the watch-list as potential factors for possible slowdowns of growth in the continent.