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Agriculture lifts economy to a 5.9pc growth in third quarter

 Maize harvesting at a farm in Uasin Gishu County. [Christopher Kipsang, Standard]

The economy grew 5.9 per cent in the third quarter to September this year compared to 4.3 per cent in the previous year. This follows good weather patterns that saw agriculture post-much-improved growth compared to a contraction over the same quarter in 2022.

According to the Kenya National Bureau of Statistics (KNBS), most of the sectors registered growth, with major growth rates recorded by accommodation and services, finance and insurance, ICT and agriculture. 

Electricity and transport sectors however recorded declines.

Agriculture grew 6.7 per cent over the quarter to September 2023, compared to a negative growth of 1.3 per cent over a similar quarter last year due to the prolonged drought.

“The country’s real Gross Domestic Product (GDP) grew by 5.9 per cent in the third quarter of 2023, compared to 4.3 per cent in the corresponding quarter of 2022. This growth was mainly supported by a rebound in agricultural activities that had contracted in 2022,” said KNBS in a quarterly economic performance report.

It noted that the growth was largely on account of the rebound in agriculture which has enjoyed favourable weather conditions over the first three quarters of 2023.

KNBS noted that among the factors that pushed growth include fruit exports, which rose by 84.3 per cent while vegetable exports and tea production rose by 35.4 per cent and 28.0 per cent, respectively, in the third quarter of 2023. 

“During the review quarter, agriculture, forestry, and fishing activities’ gross value-added rose by 6.7 per cent compared to a contraction of 1.3 per cent in the third quarter of 2022, owing to favourable weather conditions that characterised the better part of 2023.”

“In addition, the growth was also buoyed by significant growths in financial and insurance (14.7 per cent), information and communication (7.3 per cent) and accommodation and food service (26 per cent) activities. 

The substantial growth in accommodation and food activities was manifest in the significant increase in the number of visitor arrivals in the country.”

Despite the growth that was recorded over the quarter, the electricity and transport sectors recorded slower growth.

According to KNBS, electricity and water supply recorded a decelerated growth of 1.9 per cent in the third quarter of 2023 compared to a growth of six per cent in the corresponding quarter of 2022.

Fuel prices

Transport and storage grew at a rate of 2.8 per cent, a slowed growth rate compared to 5.1 per cent in 2022. This was largely on account of higher cost of fuel prices which resulted in a decline in the consumption of petroleum products.

“Transportation and storage sector activities were slower in the third quarter of 2023 compared to the corresponding quarter of 2022. The sector is estimated to haverecorded 2.8 per cent growth in the period under review compared to 5.1 per cent growth in a similar quarter of 2022. The growth was mostly supported by transport via railway, port activities and air transportation,” said the State statistician. 

“Consumption of light diesel, a key input to land transportation, decreased by 2.3 per cent… in the third quarter of 2023.”

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