A cross-sectional photo of the fast growing Nairobi’s Upperhill area as seen in this picture taken on 27th September, 2016. Picture; Jacob Otieno
Economists have revised their view of Kenya’s economy, owing to slower growth, high inflation and political uncertainty ahead of the August 8 elections.
Panelists at FocusEconomics, who do monthly review of 13 leading Sub-Saharan economies, have revised their growth forecast for the country downwards by 0.1 percentage points from last month’s estimate.
“For 2017, FocusEconomics Consensus Forecast panelists see GDP expanding 5.2 per cent before picking up slightly to 5.6 per cent growth in 2018,” they said in their monthly bulletin.
The panelists said economic growth was expected to suffer somewhat this year due to the interest cap introduced late last year and the dire situation in the agricultural sector where the country is yet to recover from the debilitating effects of a prolonged drought.
Political uncertainty around the August polls, they added, could also dampen business sentiments and delay investment decisions.
The group said both IHS Markit and CfC Stanbic Bank had also in their Purchasing Managers’ Index, which monitors company purchasing managers activities, cited a downward growth forecast to 49.9 per cent in May, down from 50.3 in April.
They also said inflation would remain high due to rising food and energy prices.