Kenya’s current account deficit is projected to narrow in 2023, helped by a better trade performance, the country’s central bank said on Wednesday.
The regulator said the current account deficit was 5.1 per cent of gross domestic product in 2022, and is projected to improve to 4.8 per cent of GDP in 2023.
“This is a modest decline..,” Dr Njoroge. “….The 5 per cent level is really a sweet spot…”
The expected narrow CAD will be supported by lower international oil prices, resilient remittances and strong export growth.
According to Dr Patrick Njoroge, CBK Governor, the expected narrow CAD will be supported by lower international oil prices, resilient remittances and strong export growth.
Kenya exports and imports
In the MPC review period, goods exports remained strong, growing by 6.6 per cent in the 12 months to April 2023 compared to a similar period in 2022.
Receipts from tea and manufactured goods exports increased by 11.6 per cent and 30.4 per cent, respectively during the period. The increase in receipts from tea exports reflects improved prices attributed to demand from traditional markets.
“Imports grew by 1.2 per cent in the 12 months to April 2023 compared to 21.3 per cent in a similar period in 2022, with lower imports of infrastructure-related equipment due to completed projects. Oil prices have continued to moderate from the fourth quarter of 2022.”
Oil prices continued to moderate from the fourth quarter of 2022.
Receipts from services exports increased reflecting sustained improvement in international travel and transport.
Remittances totalled USD 3,985 million in the 12 months to April 2023 and were 0.4 per cent higher compared to a similar period in 2022.