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Kenya: Against the oddsDate : 27/05/2010 Publication
: Emerging Markets Category
: Business and Economy
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Kenya's economy is back on track after a growth plunge, sparked by the global economic crisis and the violence that followed December 2007's disputed presidential election. But concerns remain that a slow global recovery and further political strife could limit the pace of growth.
GDP growth plummeted from 7.1% in 2007 to 1.7% in 2008 on the back of the post-election violence, which brought the country to a standstill for months, and the global crisis, which hit exports, foreign inflows and remittances. Provisional estimates from the Finance Ministry put 2009 growth at 2.2%. This year, however, the recovery is expected to gather pace.
“Kenya’s economy is beginning to emerge from the challenges of the last quarter of 2007 and the first quarter of 2008,” Finance Minister and Deputy Prime Minister Uhuru Kenyatta told Emerging Markets. “Kenya has the potential to grow at 4% in 2010.”
The International Monetary Fund and analysts agree 4% is a realistic estimate, as prospects for growth improve in two key sectors. Good rains after a two-year drought have improved the outlook for agriculture, which accounts for about a quarter of GDP, and tourism is expected to pick up.
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