Kenya’s Economy Rebounds 10.1% in the Second Quarter

Kenya’s economy rebounded 10.1 per cent year-on-year in the second quarter of 2021, buoyed by good performance across all sectors, according to preliminary figures released by the National Bureau of Statistics. This is compared to a contraction of 0.2 per cent in a similar period in 2020.

In Quarter one, the country’s economic growth recovered to 0.7 per cent.

“The growth recorded was mainly a result of easing of COVID-19 containment measures that facilitated gradual resumption of economic activity,” the Kenya National Bureau of Statistics (KNBS) said in its Quarterly Gross Domestic Product Report for the First Quarter, 2021 and Second Quarter, 2021.

Some of the sectors that supported overall growth in the second quarter included Manufacturing (9.6%), Education (67.6%), Transportation and Storage (16.9%), Information and Communication (25.2%) and other Services Activities (20.2%).

However, sectors in agriculture, forestry and fishing activities in the first and second quarters of 2021 declined. The sector contracted by 0.9 per cent in the second quarter of 2021 compared to a growth of 4.9 per cent in the corresponding quarter of 2020. 

Kenya’s economic growth for the year is projected at 6.6 per cent by the National Treasury.

However, Genghis Capital noted that varying estimates from Kenya, the World Bank (4.5 per cent and 4.7 per cent), Central Bank of Kenya (6.1 per cent) and the International Monetary Fund (5.6 per cent) were ‘irrational’ and that they were too optimistic.

“We really believe this optimism is largely irrational and the story of Kenya’s economic growth remains a puzzle to us,” Genghis said in a note to investors dated 8th November 2021.