NAIROBI, KENYA, Apr 25 – Chief Executives in the country are most optimistic about the prospects of the Energy and ICT sectors of the economy in 2017.
This is according to the CEOs Business Confidence Survey which was commissioned by Kenya Private Sector Alliance (KEPSA) and gave the sectors 67 and 63 index points respectively.
Maggie Ireri from Tifa Research said confidence in the energy sector is driven by incentives by the government and the opportunities created to increase electricity access.
“The zero-rated import duty and VAT exemption on equipment and accessories for entities producing electricity via solar energy were among the determinants,” said Maggie Ireri, the Director of Tifa Research, which conducted the survey.
She further credited the high optimism in ICT as being driven by the growing mobile phone segment that has created a vibrant fintech segment.
The banking and the transport sector are among the sectors with the least confidence levels.
The survey, which gave the banking sector 42 index points, has attributed capping of the interest rates under the Banking Amendment Bill 2016 to the low levels of confidence.
“We have seen quite a number of banks layoff employees as others close some of their branches because of the interest rates cap. We are therefore not surprised by the low ranking of the sector,” Ireri said.
Transport also ranked low at 40 points, with the survey crediting the poor prospects to poor prospects for air transport, even as the postal and courier activities are seen as having a buoyant effect on the sector.
Tourism is surprisingly doing well with CEOs giving it 50 index points despite it being an election year.
The sector has benefited from a number of international conferences that the country has hosted in the past two years and improved security. Kenya is expected to host the African Ports Expansion Conference and the Africa Mobile and Digital Banking Summit among others.
“There has also been a steady rise in the number of residential units targeting tourists, especially new hotels and services residences. There’s also a likelihood that 8 new hotels will open this year.”
90 CEOs participated in the survey.