Kenya’s economic growth slows to 5.3 pct in 2014

Kenya’s economic growth slows to 5.3 pct in 2014

Nairobi, (Reuters) – Kenya’s economic growth slowed to 5.3 percent in 2014 from 5.7 percent in the previous year, hurt by a contraction in tourism and weaker agricultural output, a cabinet minister said on Wednesday.

Centeral Bank of Kenya
Centeral Bank of Kenya

East Africa’s biggest economy has struggled with challenges that have hurt its key foreign exchange earners, including periodic droughts that have reduced farm output and attacks blamed on Somalia’s al Shabaab militants that have hurt tourism.

“Factors that impacted negatively on the tourism sector include security concerns, negative travel advisories and fear of spread of Ebola,” said Anne Waiguru, the devolution and planning cabinet secretary.

She said increased government spending on roads and railways had helped growth in the construction sector, but the agriculture sector had experienced a slowdown.

Waiguru said agriculture output in 2014 slowed to 3.5 percent compared with 5.2 percent in 2013, while earnings from tourism were down 7.3 percent to 87.1 billion shillings.

“The agricultural sector recorded mixed performance mainly attributable to erratic rains with some regions experiencing depressed rainfall,” she said while launching the annual economic survey.

The 2013 growth figure was revised upwards after rebasing in September, when Kenya’s gross domestic product was estimated to be 25 percent bigger after the authorities changed the base calculation year to 2009 from 2001.

Kenya’s Treasury said in a budget policy document in January that it expects the economy to expand by 6.9 percent this year, up from an initial growth forecast of 6.5 percent. (Reporting by Duncan Miriri; Writing by George Obulutsa; Editing by James Macharia).

Source: Reuters