NAIROBI, Kenya, Aug 5 – Private sector activities in Kenya last month saw a sharp decline, weighed down by Gen Z’s countrywide protests that disrupted business operations.
Latest Stanbic Bank Kenya’s Purchasng Manager’s Index (PMI) shows that the country’s PMI in July dropped to 43.1 percent from 47.2 in June.
While a PMI reading below 50 indicates a downtick and deterioration in business activities, the figure above shows growth and improvement.
Up until last month, Kenyan young people went to the streets to protest the 2024 Finance Bill that was later dropped by President William Ruto.
The new law had recommended a slew of new taxes on mobile money as well as bread and on diapers and pads through the ecolevy.
“The July PMI is a fair representation of business activity during the month. Private sector business activity deteriorated, reflecting ongoing demonstrations and unrest in parts of Kenya for some weeks now, discouraging output and new orders. Business operations were disrupted, and customers delayed spending decisions due to the uncertainty,” Standard Bank Economist Christopher Legilisho said.
“With lower sales and orders across most sectors surveyed, purchasing quantities and inventories slipped for a second consecutive month.”
Legilisho added that there was a slight increase in input prices, purchase prices, staffing costs, and output prices, reflecting the higher cost of living and taxation.
“However, output price increases in agriculture, services and wholesale and retail trade were counterbalanced by declines in construction and manufacturing.”
Despite dampened activities, job levels expanded for a seventh month in a row as firms increased capacity to address month backlogs, exacerbated by the protests.
