Kenya's economy to rebound in 2018 - minister

Tuesday November 7 2017

Kenya's Treasury Cabinet Secretary Henry Rotich. PHOTO | NMG

Kenya's Treasury Cabinet Secretary Henry Rotich. PHOTO | NMG 

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Kenya’s economy should rebound in 2018 after a slowdown this year that was caused by drought and political turmoil during a prolonged election cycle, Treasury Cabinet Secretary Henry Rotich said on Tuesday.

Economic growth is forecast to rise to more than 6 per cent next year and to move towards 7 per cent in the medium term, Rotich said.

He had earlier trimmed the 2017 forecast to 5 per cent from a previous projection of 5.5 per cent, which itself was a reduction from 5.9 per cent.

The economy grew 5 per cent in the first half of the year, the government said, falling short of its full-year forecast.

“By and large, agriculture this year will be better than last year, that is the reason why our growth looks optimistic, even at this time when we face these challenges on the investment side,” Rotich told a news conference.

Rotich said that revenue collections for the first four months of the 2017/18 (July-June) fiscal year had fallen short by Ksh40 billion ($386.47 million).

Kenya’s economy has faced a slowdown for the better part of the year. In addition to the drought and its political uncertainty, credit growth has slowed, partly because of a cap on commercial bank lending rates imposed last September.