•The growth momentum slowed down to 4.8 per cent in 2022 from 7.5 per cent in 2021.
•The 2023/2024 Budget is being prepared against a background of increased uncertainties in the global economic outlook.
National Treasury CS Njuguna Ndung’u has predicted a strong performance of the Kenyan economy in the first quarter of the 2023/2024 Financial Year.
He said the performance will reflect a robust activity in the services sector particularly the wholesale and retail trade, accommodation and food services, education and information and communication.
“As such the economy is expected to remain resilient in 2023 and grow by 5.5 per cent and maintain the momentum over the medium-term,” Ndung’u told the Budget and Appropriations Committee.
The CS said the growth outlook will be supported by broad-based private sector growth, including the continued strong performance of the services sector and recoveries in agriculture.
“From an expenditure perspective, private consumption is expected to support aggregate demand, supported by the ongoing labour market recovery, increased agricultural production, improved consumer confidence and resilient remittances,” he added.
The CS noted that the growth momentum slowed down to 4.8 per cent in 2022 from 7.5 per cent in 2021.
“This is mainly due to multiple shocks that included effects of the Covid-19 pandemic, the Russia-Ukraine conflict leading to increased prices of fuel, fertilizer and food and climate change that has severely affected agricultural productivity,” he stated.
Ndung’u however pointed out that the 2023/2024 Budget is being prepared against a background of increased uncertainties in the global economic outlook.
“On a positive note, commodity prices in the global markets particularly oil and food have started showing signs of easing,” he said.
He said IMF forecasts show that in emerging markets and developing countries, growth is projected to rise 4.0 per cent in 2023 from an estimated 3.9 per cent in 2022 mainly driven by the recovery of activities in China with the full reopening in 2023.
He added that China’s economy is projected to improve to 5.2 per cent from 3.0 per cent in 2022.
In the Sub-Saharan Africa region, the growth is projected to remain moderate at 3.8 per cent, the CS told the Ndindi Nyoro-led committee.