Kenya is forecast to be the fastest-growing economy in Sub-Saharan Africa in the next decade, according to Simon Baptist, chief economist at the Economist Intelligence Unit (EIU).
In a note Friday, Baptist said patterns of growth are changing, and that growth itself can no longer be taken for granted.
“I expect that growth will be roughly half as fast in the 2020s as it was in the 2010s. The fastest-growing countries will be in Africa (although not Nigeria) and south and south-east Asia, with Bangladesh, Kenya and the Philippines all looking at a strong decade,” he said.
In my newsletter this week I picked out 4 trends to watch in the 2020s:
1. New growth stars (eg BD,KE,PH)
2. Ageing and 'Japanification' of some EMs
3. Political instability due to tech influence in EMs
4. US-China bifurcation
A few ppl ?ing why I didn't say climate (cont)
— Simon Baptist EIU (@baptist_simon) December 20, 2019
According to Baptist, countries with the fastest ageing and declining populations, such as Japan, Italy and Portugal, can expect growth close to zero.
He says ageing is likely to cause difficulties such as strengthening currencies and increased care needs in emerging markets like China, Russia, and Thailand.
A third trend foresees is a continuation of political instability, with rising literacy and the falling costs of communication revolutionizing the political landscape in emerging markets.
However, he says he does not think climate change will be important in the coming decade. “In an optimal policy world should be lots of action in 2020s. But unfort I think the level of action will be well below optimal. That means more, and more costly, adaptation in 2030s onwards.”
Kenya’s economy is predicted to grow by 5.9% this year from the Central Bank of Kenya. ”The 2019/20 economic growth is well anchored and we expect it to hit 5.9 per cent which is more same to a projection of six percent,” Central Bank governor Patrick Njoroge said in November in his post Monetary Policy Committee (MPC) press briefing.
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Rand Merchant Bank also named Kenya among the top 10 countries where to invest in Africa the year 2020.
“The economy benefits from diversity as well as a sustained expansion in consumer demand, urbanisation, East African Community (EAC) integration, structural reforms and investment in infrastructure, including an oil pipeline, railways, ports and power generation,” co-authors Celeste Fauconnier, Neville Mandimika and Nema Ramkhelawan-Bhana said in the bank’s 9th edition.