Kenya: 2017 Economic Survey launched
Remarks by Hon. Mwangi Kiunjuri, Egh, Mgh Cabinet Secretary in the Ministry of Devolution and Planning, during the launch of the 2017 Economic Survey, 19 April 2017
Let me take this opportunity to welcome you all to this official launch of the 2017 Economic Survey Report which focuses on the performance of our economy in 2016.
The Report has been prepared by the Kenya National Bureau of Statistics and provides detailed information on socio-economic indicators in agriculture, environment and natural resources, manufacturing, public finance, Transport, building and construction among others.
It is our belief that the statistics contained in the Report are of practical use to various stakeholders including policy makers, Research Institutions, investors and business community.
As has been pointed out, the economy grew by 5.8 per cent in 2016 compared to a revised growth of 5.7 per cent in 2015. it remained resilient in the face of one of the worst droughts witnessed in the last quarter of 2016. This growth was achieved through the Government’s commitment in creating an enabling environment for doing business in key areas including:
Ongoing public infrastructure development, e.g. roads construction
Tourism which had a remarkable improvement as it benefitted from improved security with the number of international visitor arrival expanding by 13.5 per cent in 2016 to 1.34 million.
Increased total installed electricity capacity enabling the Government to connect an unprecedented number of customers which rose by 38.2 per cent under the Rural Electrification Programme. Our rural population is now experiencing the same benefits out of this connectivity as has been enjoyed by urban populations.
Another important sector that recorded significant growth is the ICT which grew by 9.7 per cent in 2016. 39.9 million Kenyans are now using mobile phone enabling easy access to digital services offered by the government. Owing to this connectivity, the value of money transacted through mobile services increased by 21.4 per cent, from from 2.8 trillion in 2015 to 3.4 trillion in 2016 making Kenyan a leader in mobile money transaction in the world.
It is worth highlighting too that the economy generated a total of 832.9 thousand new jobs against the target of 1 million jobs, representing 83.3 per cent of the target.
However, the country is still phasing some challenges in overrelying on rain fed agriculture though the Government is investing heavily in irrigation programmes to transform the sector. Also, the manufacturing sector is still phasing some challenges in regards to cheap imports and the counterfeit goods, this again is being addressed by the policies that have been put in place.
My Ministry will continue to regularly monitor evaluat and report on our economy with a view to drawing lessons for improved performance as we move towards implementing the MTP III of the Kenya Vision 2030 and the Sustainable Development Goals (SDGs) which require comprehensive data to monitor their progress.
I am happy to note that over the years, the Economic Survey Report has provided a candid appraisal of the achievements and challenges we face as a nation in our endeavour to develop our country and improve the welfare of our people. And we shall continue to do so.
2017 Economic Survey
Kenya’s Gross Domestic Product (GDP) is estimated to have expanded by 5.8 per cent in 2016 compared to a revised growth of 5.7 per cent in 2015. Accommodation and food services recorded improved growth of 13.3 per cent in the year under review compared to a contraction of 1.3 per cent in 2015. The other sectors that registered significant improved performance in economic activities were in the information and communication; real estate; and transport and storage. Persistent drought hampered growth in the fourth quarter of 2016 impacting negatively on agriculture and electricity supply. On the other hand, growth in construction; mining and quarrying; and financial and insurance activities decelerated in 2016. From the demand side, growth was buoyed by consumption in both the public and private sector.
Annual average inflation eased to 6.3 per cent in 2016 compared to an average of 6.6 per cent in 2015. This was mainly due to decline in prices of transportation; housing and utilities; and communication. The Shilling strengthened against the Pound Sterling, South African Rand, Ugandan Shilling, Tanzanian Shilling and the Rwandan Franc but weakened against the US Dollar, Euro, and the Yen in 2016. The capping of interest rates to a maximum of 4.0 per cent above the Central Bank Rate (CBR) resulted in a significant decline in interest rates during the month of September to 13.84 per cent compared to 16.75 in a similar month in 2015.
Domestic credit slowed from a growth of 20.8 per cent in 2015 to 6.4 per cent in 2016 mainly on account of a decline in credit to the private sector. The current account deficit narrowed to KSh 370.8 billion in 2016 from a deficit of KSh 421.1 billion in 2015. The fiscal deficit in 2016/17 as a percentage of GDP is expected to rise to 9.9 per cent compared to 8.6 per cent in 2015/16.