(Bloomberg) -- The pace of Kenya’s economic growth decelerated in the third quarter to the slowest in almost four years after all key industries recorded less output following anti-government protests.
Gross domestic product expanded 4% in the three months through September from a year earlier, compared with 4.6% in the previous quarter and a revised 6% during the third quarter of 2023, the Kenya National Bureau of Statistics said Tuesday.
That was below the central bank’s forecast of 5.2% and the slowest rate of growth since the first quarter of 2021.
“The decelerated growth was largely due to a general decline in growth in most sectors of the economy,” the agency said. Contractions in construction, mining and quarrying constrained activity, it said.
Protests erupted over President William Ruto’s plans to introduce unpopular taxes in June, with at least 82 people going missing and 29 still unaccounted for, according to the Kenya National Human Rights Commission.
The economy’s main growth engine is agriculture, forestry and fishing, which together account for almost a quarter of Kenya’s total output and expanded by 4.2%, less than the 4.8% expansion in the prior three months after tea production dropped significantly.
The central bank estimates overall growth for 2024 at 5.1% and 5.5% this year, Governor Kamau Thugge said in December.
Stanbic Bank and S&P Global purchasing managers’ index for Kenya’s whole economy during the third quarter fell to 49.7 in September, with the average during the third quarter at 47.8. R readings above 50 signaling an improvement in business conditions on the previous month, while those below that figure show a deterioration.
Key Insights
- Accommodation and food services — which reflect the performance of the tourism industry and together are among the country’s largest foreign-exchange earners — jumped 13.7% compared with 26.6% in the prior quarter.
- Financial and insurance services, which contribute just above 7% of GDP, grew 4.7% compared with 5.1% in the previous three months.
- Manufacturing, which also accounts for slightly more than 7% of economic output, climbed 2.3% compared with 3.3% in the prior quarter as output of galvanized sheets, cement and assembly of motor vehicles declined.
- Construction activities contracted by 2% compared with a 2.9% decline in the third quarter after cement consumption declined by 10%.
- Mining and quarrying contracted 11.1%.
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