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Economy grows by 5.9pc in first quarter

BUSINESS
By Lee Mwiti | July 1st 2016

The economy has expanded by 5.9 per cent during the first quarter of 2016, compared to a five per cent growth in a similar period in 2015. This is according to data from the Kenya National Bureau of Statistics (KNBS) released Thursday.

At the same time, the country’s statistics body announced month-on-month inflation rose to seven per cent during the quarter under review, compared to 5.8 per cent in the first quarter of 2015. The economic expansion has been occasioned by a notable improvement in the agriculture, forestry and fishing sectors which, was supported mostly by increase in cash crops exports. Tea and horticulture crops exports expanded by 4.8 per cent in the quarter under review. This is compared to a 2.9 per cent growth in a similar quarter in 2015.

Another notable sector that powered the growth is accommodation and food services. It posted a growth of 12.1 per cent in the quarter under review, after a two year spell of poor performance largely occasioned by security concerns and economic downturn in some key tourist markets.

This recovery is evidenced by a significant rise in the number of tourist arrivals at major airports. With regard to inflation, the statistics body said overall inflation rate in the month of June 2016 stood at 5.8 per cent. This was brought about by an increase in commodity prices such as food and non-alcoholic beverages whose price indices jumped by 2.1 per cent in June.

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