<< Click to Display Table of Contents >> Navigation:  Finance and Economic Planning > CFSP > 2015-16 FY CFSP > RECENT ECONOMIC DEVELOPMENTS AND POLICY OUTLOOK > NatioSal Economic Situation

The county’s performance is largely dependent on the formulation and implementation of prudent policies to guide service delivery and the country’s economic performance. The Kenya National Bureau of Statistics (KNBS) completed the process of rebasing and revising of the National Accounts Statistics (NAS) in September 2014. The rebased GDP estimates in nominal terms for 2013 is Ksh 4,757.5 billion which represents 25.3 percent increase from the previous estimates. This translates to US$ 1,269 in GDP per capita in 2013 up from US$ 994, placing Kenya at lower middle income economy.

 

Recent developments in the key macroeconomic variables are encouraging. Growth in real GDP remains resilient but downside risks remain. Real GDP is projected to expand by 5.3 percent in 2014 from an earlier forecast of 5.8 percent in 2014, 6.9 percent in 2015 and 7.0 percent in 2018. In terms of fiscal years, the projections translate to 5.5 percent in 2013/14,  6.1  percent  in  2014/15,  7.0  percent  in 2015/16  and  7.3  percent  in 2018/19. The economic growth outlook is underpinned by continued good performance across all sectors of the economy. The projected growth assumes normal weather pattern in 2015 and the medium term. Inflation is expected to be maintained at a single digit level and near the 5 percent target reflecting implementation of a prudent monetary policy and easing of both food and oil prices, and stability of the shilling exchange rate to the major international currencies following increased short term capital inflows and remittances.

 

The above mentioned  level  of  growth  will  be  supported  by  increased  production  in agriculture following the interventions being put to revamp the sector together with other measures, continued investment in infrastructure projects, expansion of activities in other sectors of the economy such as building and  construction,  manufacturing,  retail  and  wholesale  and  financial intermediation, among others. The growth will also benefit from increased investments and domestic demand, following investor confidence and the on- going initiatives to deepen regional integration.

The growth will accelerate in the outer years as issues suppressing growth are addressed which include: infrastructure development, removal of obstacles that includes cost of energy by increased geothermal generation, successful integration, financing access, opportunities for the SMEs, and the development of the oil and gas sector.