Connect with us

Hi, what are you looking for?

Capital Business
Capital Business
World Bank Kenya Senior Economist John Randa says the country's infrastructure projects and devolution are expected to firm up growth in 2015/FILE

Kenya

WB forecasts 6pc growth for Kenya this year

World Bank Kenya Senior Economist John Randa says the country's infrastructure projects and devolution are expected to firm up growth in 2015/FILE

World Bank Kenya Senior Economist John Randa says the country’s infrastructure projects and devolution are expected to firm up growth in 2015/FILE

NAIROBI, Kenya, Mar 5 – The World Bank has forecast Kenya’s economy will have a growth of 6 percent in 2015 and rise to 6.6 percent in 2016, owing to falling oil prices and bigger infrastructure investments.

This comes after economists surveyed by Bloomberg Business rated Kenya third in the top 20 fastest growing economies in the world in 2015.

Speaking when launching the Kenya economic update 11th edition, World Bank Kenya Senior Economist John Randa says the country’s infrastructure projects and devolution are expected to firm up growth in 2015.

READ: Kenya emerges 3rd in global top 20 fastest growing economies

“The ongoing road construction the Standard Gauge Railway, the LAPSSET project and investments in counties will be the key drivers of the country’s economy in 2015,” Randa said.

He is however wary of the country’s exports growth has been lagging behind that of imports, and urged the country to focus more on the manufacturing sector to boost exports.

He highlighted a weak business environment as a key constraint for growth of the manufacturing sector.

“Manufacturing firms need access to capital for their investments, infrastructure to import inputs and export and distribute finished products, affordable and reliable electricity to produce skilled labour to man their operations and fair and streamlined regulations that allow them to compete,” he stated.

According to the report, Kenya’s manufacturing sector (that contributes about 11 percent to the Gross Domestic Product) has been stagnant in recent years and it has lost international market share. Low overall productivity and large productivity differences in firms across subsectors point to lack of competition which allows low productivity firms to remain in business.

“Kenya needs to continue investing in infrastructure and human capital improve the business and regulatory environment and diversify exports. Increasing exports is crucial for creating the thousands of low skilled jobs needed to reduce high unemployment especially among young people,” the report states.

Advertisement. Scroll to continue reading.

The report also points out that Kenya has increased its vulnerability to external shocks owing to its entry into the sovereign bond market.

“To protect against such vulnerabilities Kenya needs to preserve and rebuild fiscal policy buffers,” the report indicates.

Kenya’s economy is estimated to have grown by 5.4 percent in 2014.

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Headlines

NAIROBI, Kenya, Mar 16 – The World Bank has given the Kenyan government USD 60 Million (Sh6.1 billion) to help combat the deadly coronavirus pandemic...