- This year, Kenya expects a strong economic recovery as the nation’s coronavirus vaccination programme gains momentum
- Inflation grew to 5.4 per cent in 2020 compared to 5.3 in 2018 and 4.7 per cent a year earlier.
Kenya's economy, just like the global one took a beating from the rough effects of Covid-19 to record negative growth, the lowest in 12 years.
According to the Economic Survey, 2021 by the Kenya National Bureau of Statistics (KNBS) released Thursday, the country's economic growth shrunk to -0.3 per cent last year compared to five per cent in 2019.
East Africa’s biggest economy last contracted in the third quarter of 2008 after post-election violence caused a decline in output of 1.6 per cent
''Real economic growth in 2020 was estimated to have contracted owing to disruption caused by the Covid-19 pandemic,'' KNBS said.
Accommodation and food service felt the most impact, with its contribution to the country's economy dropping by 47.7 per cent on tough Covid-19 restrictions imposed on the hospitality sector.
Kenya’s tourism sector lost close to $1 billion in revenue between January and October when numbers of foreign visitors fell by two thirds.
Education was also affected after the government closed learning institutions for almost a year. The sector's contribution to the country's economy dropped by 10.7 per cent.
“The poor performance was characterized by substantial contractions in accommodation and food services, education, taxes on products, and transportation and storage, which consequently occasioned the significant downturn,'' KNBS said.
The overall performance during the period under review was, however, cushioned from a deeper slump by growths in Agriculture, Forestry and Fishing activities (4.8%).
Financial and insurance activities grew 5.6%per cent; construction (11.8%); health services (6.7%) and information technology at 4.8 per cent.
This year, Kenya expects a strong economic recovery as the nation’s coronavirus vaccination programme gains momentum and the services industry rebounds from a brutal pandemic fallout.
The slowdown in economic activities was also felt at the family level, with the cost of living hitting a three-year high as Covid-19 containment measures disrupted the supply chain.
Inflation grew to 5.4 per cent in 2020 compared to 5.3 in 2018 and 4.7 per cent a year earlier.
According to KNBS, an increase in global oil prices had a spiral effect on the cost of basic commodities especially food, as traders passed the high import and transport costs to consumers.