Kenya: Economy#
Kenya is the economic and transport hub of East Africa. Kenya’s real GDP growth has averaged over 5% for the last seven years. Since 2014 Kenya has been ranked as a lower middle income country because its per capita GDP crossed a World Bank threshold. While Kenya has a growing entrepreneurial middle class and faster growth, its economic and development trajectory is threatened by weak governance and corruption. Unemployment and under-employment are high, but reliable numbers are hard to find.Agriculture remains the backbone of the Kenyan economy, contributing 25% of GDP. About 80% of Kenya’s population of roughly 42 million work at least part-time in the agricultural sector, including livestock and pastoral activities. Over 75% of agricultural output is from small-scale, rain-fed farming or livestock production.
Inadequate infrastructure continues to hamper Kenya’s efforts to improve its economic growth to the 8-10% range so that it can meaningfully address poverty and unemployment. The KENYATTA administration sought external investment in infrastructure development. International financial institutions and donors remain important to Kenya's economic growth and development, but Kenya has also successfully raised capital in the global bond market. Kenya issued its first sovereign bond offering in mid-2014. Nairobi has contracted with a Chinese company to construct a new standard gauge railway connecting Mombasa and Nairobi, with completion expected in 2017. The country is in the process of devolving some state revenues and responsibilities to the counties. Inflationary pressures and sharp currency depreciation peaked in early 2012 but have since abated following low global food and fuel prices and monetary interventions by the Central Bank. Chronic budget deficits, including a shortage of funds in mid-2015, hampered the government’s ability to implement proposed development programs, but the economy is back in balance with many indicators, including foreign exchange reserves, interest rates, inflation, and FDI moving in the right direction.
Tourism holds a significant place in Kenya’s economy. Multiple terror attacks by the Somalia-based group al-Shabaab in the time since the 2013 attack on Nairobi’s Westgate mall, which killed at least 67, had a negative effect on international tourism earnings, but the sector is starting to recover. Kenya’s success in hosting a series of incident-free high-profile events in the second half of 2015, including the visit of US President Obama, has helped improve the outlook for tourism.
Economic Facts#
| GDP (purchasing power parity) | $152.7 billion (2016 est.) $144.1 billion (2015 est.) $136.4 billion (2014 est.) note: data are in 2016 dollars |
|---|---|
| GDP (official exchange rate) | $69.17 billion (2015 est.) |
| GDP - real growth rate | 6% (2016 est.) 5.6% (2015 est.) 5.3% (2014 est.) |
| GDP - per capita (PPP) | $3,400 (2016 est.) $3,300 (2015 est.) $3,200 (2014 est.) note: data are in 2016 dollars |
| Gross national saving | 16.1% of GDP (2016 est.) 12.7% of GDP (2015 est.) 12.2% of GDP (2014 est.) |
| GDP - composition, by end use | household consumption: 77.6% government consumption: 14.2% investment in fixed capital: 21.3% investment in inventories: -0.3% exports of goods and services: 15.2% imports of goods and services: -28% (2016 est.) |
| GDP - composition, by sector of origin | agriculture: 32.7% industry: 18% services: 49.3% (2016 est.) |
| Agriculture - products | tea, coffee, corn, wheat, sugarcane, fruit, vegetables; dairy products, beef, fish, pork, poultry, eggs |
| Industries | small-scale consumer goods (plastic, furniture, batteries, textiles, clothing, soap, cigarettes, flour), agricultural products, horticulture, oil refining; aluminum, steel, lead; cement, commercial ship repair, tourism |
| Industrial production growth rate | 6.6% (2016 est.) |
| Labor force | 18.66 million (2016 est.) |
| Labor force - by occupation | agriculture: 75% industry and services: 25% (2011 est.) |
| Unemployment rate | 40% (2013 est.) 40% (2001 est.) |
| Population below poverty line | 43.4% (2012 est.) |
| Household income or consumption by percentage share | lowest 10%: 1.8% highest 10%: 37.8% (2005) |
| Distribution of family income - Gini index | 42.5 (2008 est.) 44.9 (1997) |
| Budget | revenues: $12.89 billion expenditures: $17.85 billion (2016 est.) |
| Taxes and other revenues | 18.6% of GDP (2016 est.) |
| Budget surplus (+) or deficit (-) | -7.2% of GDP (2016 est.) |
| Public debt | 50.4% of GDP (2016 est.) 48% of GDP (2015 est.) |
| Fiscal year | 1 July - 30 June |
| Inflation rate (consumer prices) | 6.1% (2016 est.) 6.6% (2015 est.) |
| Central bank discount rate | 11.5% (20 January 2016) 7% (31 December 2010) |
| Commercial bank prime lending rate | 17.5% (31 December 2016 est.) 16.09% (31 December 2015 est.) |
| Stock of narrow money | $11.07 billion (31 December 2016 est.) $9.927 billion (31 December 2015 est.) |
| Stock of broad money | $24.02 billion (31 December 2014 est.) $18.92 billion (31 December 2013 est.) |
| Stock of domestic credit | $31.52 billion (31 December 2016 est.) $27.5 billion (31 December 2015 est.) |
| Market value of publicly traded shares | $26.16 billion (31 December 2014 est.) $22.09 billion (31 December 2013 est.) $14.79 billion (31 December 2012 est.) |
| Current account balance | -$4.444 billion (2016 est.) -$4.31 billion (2015 est.) |
| Exports | $6.363 billion (2016 est.) $5.982 billion (2015 est.) |
| Exports - commodities | tea, horticultural products, coffee, petroleum products, fish, cement |
| Exports - partners | Uganda 11.2%, US 8.3%, Tanzania 8.1%, Netherlands 7.4%, UK 6%, Pakistan 4.2% (2015) |
| Imports | $16.34 billion (2016 est.) $15.56 billion (2015 est.) |
| Imports - commodities | machinery and transportation equipment, petroleum products, motor vehicles, iron and steel, resins and plastics |
| Imports - partners | China 30%, India 15.5%, UAE 5.7%, US 4.8%, Japan 4.7% (2015) |
| Reserves of foreign exchange and gold | $7.374 billion (31 December 2016 est.) $7.548 billion (31 December 2015 est.) |
| Debt - external | $20.25 billion (31 December 2016 est.) $17.92 billion (31 December 2015 est.) |
| Stock of direct foreign investment - at home | $5.537 billion (31 December 2016 est.) $4.662 billion (31 December 2015 est.) |
| Stock of direct foreign investment - abroad | $NA (31 December 2016 est.) $NA (31 December 2015 est.) |
| Exchange rates | Kenyan shillings (KES) per US dollar - 102 (2016 est.) 98.179 (2015 est.) 98.179 (2014 est.) 87.921 (2013 est.) 84.53 (2012 est.) |