NAIROBI, Kenya, May 18-The International Monetary Fund has revised Kenya’s economic expansion to 6.3 percent from the earlier projection of 7.6 percent.
In a statement, IMF said this is being influenced by the third wave of the coronavirus pandemic that has continued to slow down the country’s economic activities.
“The economic recovery should be sustained, although the persistence of the pandemic suggests the pickup envisioned in 2021 will be slightly less strong than anticipated. IMF staff now project the economy to expand by 6.3 percent in 2021,” reads IMF’s statement.
“The coronavirus shock has unfortunately also reversed some of the poverty reduction gains Kenya achieved in recent years and debt remains elevated,” it added.
However, IMF maintained that Kenya’s prospects are strong, and in the medium-term growth is expected to settle at its potential of just above 6 percent.
This follows a recent staff team from the International Monetary Fund (IMF) led by Mary Goodman who conducted a virtual mission to Kenya from April 29 to May 14, 2021, to discuss progress on reforms and the authorities’ policy priorities within the context of the first review of Kenya’s economic program supported by the IMF’s EFF and ECF arrangements.
Various sectors of the economy such as transport, schooling, hospitality, and tourism have been on and off since the outbreak of the coronavirus pandemic in March 2020.
At the same time, several companies layed off their employees while some preferred to put the rest on pay cuts or unpaid leave.
Kenya’s economy shrank by 5.7 percent in the second three months of 2020.
