NAIROBI, Kenya, Jun 22 – The Kenyan economy could grow by 6.1 percent in 2012, according to a leading economic analyst.
KPMG Director of Tax Services Peter Kinuthia says despite lower predictions by the Kenya National Bureau of Statistics of 4.5 percent, there are no major economic challenges expected this year.
Kinuthia said the economy has started to stabilise due to improvement in infrastructure and measures being taken by the central bank to stabilise the shilling.
“It’s not just open optimism about the economy. The feeling that Kenya is well poised to achieve GDP growth of about six percent is on the fact that all the macro economic indicators are solid. We’ve got a lot of funds being channeled to infrastructure which now opens the other sectors of the economy,” said Kinuthia.
He said the services sector will continue to lead at 59 percent, followed by Agriculture at 25 percent and manufacturing sector at 12 percent.
He said the government may have given lower predictions so as to “play safe” if the economy doesn’t grow beyond four percent.
The government had earlier predicted that the economy growth could dip abit due high oil prices, inflation and depreciation of the shilling.
But Kinuthia said the country has proved resilient to these and other economic challenges which have been much contributed by external economic shocks.
“We have discovered quite a number of minerals that we didn’t mine commercially before, coal in Kitui for example and many others that we have not exploited before. And we are saying, look, there is a lot of activities going on, and with current climate favoring agriculture, the environment just looks stable enough for us to achieve growth,” he added.
He insists that the elections do not stand a threat to the economy, as much is being done by the government to ensure peace.
For the East African Region, he predicts the economy to grow at six percent with Rwanda expected to lead at seven percent and Burundi lagging behind at 4.8 percent. Tanzania is predicted to grow at six percent and Uganda 5.5 percent.