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Kenya Economy Profile 2019

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Economy - overview

Kenya is the economic, financial, and transport hub of East Africa. Kenya’s real GDP growth has averaged over 5% for the last decade. Since 2014, Kenya has been ranked as a lower middle income country because its per capita GDP crossed a World Bank threshold. While Kenya has a growing entrepreneurial middle class and steady growth, its economic development has been impaired by weak governance and corruption. Although reliable numbers are hard to find, unemployment and under-employment are extremely high, and could be near 40% of the population. In 2013, the country adopted a devolved system of government with the creation of 47 counties, and is in the process of devolving state revenues and responsibilities to the counties.

Agriculture remains the backbone of the Kenyan economy, contributing one-third of GDP. About 75% of Kenya’s population of roughly 48.5 million work at least part-time in the agricultural sector, including livestock and pastoral activities. Over 75% of agricultural output is from small-scale, rain-fed farming or livestock production. Tourism also holds a significant place in Kenya’s economy. In spite of political turmoil throughout the second half of 2017, tourism was up 20%, showcasing the strength of this sector. Kenya has long been a target of terrorist activity and has struggled with instability along its northeastern borders. Some high visibility terrorist attacks during 2013-2015 (e.g., at Nairobi’s Westgate Mall and Garissa University) affected the tourism industry severely, but the sector rebounded strongly in 2016-2017 and appears poised to continue growing.

Inadequate infrastructure continues to hamper Kenya’s efforts to improve its annual growth so that it can meaningfully address poverty and unemployment. The KENYATTA administration has been successful in courting external investment for infrastructure development. International financial institutions and donors remain important to Kenya's growth and development, but Kenya has also successfully raised capital in the global bond market issuing its first sovereign bond offering in mid-2014, with a second occurring in February 2018. The first phase of a Chinese-financed and constructed standard gauge railway connecting Mombasa and Nairobi opened in May 2017.

In 2016 the government was forced to take over three small and undercapitalized banks when underlying weaknesses were exposed. The government also enacted legislation that limits interest rates banks can charge on loans and set a rate that banks must pay their depositors. This measure led to a sharp shrinkage of credit in the economy. A prolonged election cycle in 2017 hurt the economy, drained government resources, and slowed GDP growth. Drought-like conditions in parts of the country pushed 2017 inflation above 8%, but the rate had fallen to 4.5% in February 2018.

The economy, however, is well placed to resume its decade-long 5%-6% growth rate. While fiscal deficits continue to pose risks in the medium term, other economic indicators, including foreign exchange reserves, interest rates, current account deficits, remittances and FDI are positive. The credit and drought-related impediments were temporary. Now In his second term, President KENYATTA has pledged to make economic growth and development a centerpiece of his second administration, focusing on his "Big Four" initiatives of universal healthcare, food security, affordable housing, and expansion of manufacturing.

GDP (purchasing power parity)
$163.7 billion (2017 est.)
$156 billion (2016 est.)
$147.4 billion (2015 est.)

note: data are in 2017 dollars

GDP (official exchange rate)
$79.22 billion (2017 est.)
GDP - real growth rate
4.9% (2017 est.)
5.9% (2016 est.)
5.7% (2015 est.)
GDP - per capita (PPP)
$3,500 (2017 est.)
$3,400 (2016 est.)
$3,300 (2015 est.)

note: data are in 2017 dollars

Gross national saving
10.4% of GDP (2017 est.)
11% of GDP (2016 est.)
11.4% of GDP (2015 est.)
GDP - composition, by end use
household consumption: 79.5% (2017 est.)
government consumption: 14.3% (2017 est.)
investment in fixed capital: 18.9% (2017 est.)
investment in inventories: -1% (2017 est.)
exports of goods and services: 13.9% (2017 est.)
imports of goods and services: -25.5% (2017 est.)
GDP - composition by sector
agriculture: 34.5% (2017 est.)
industry: 17.8% (2017 est.)
services: 47.5% (2017 est.)
Population below poverty line
36.1% (2016 est.)
Labor force
19.6 million (2017 est.)
Labor force - by occupation
agriculture: 61.1%
industry: 6.7%
services: 32.2% (2005 est.)
Unemployment rate
40% (2013 est.)
40% (2001 est.)
Household income or consumption by percentage share
lowest 10%: 1.8%
highest 10%: 37.8% (2005)
Distribution of family income - Gini index
48.5 (2016 est.)
42.5 (2008 est.)
Budget
revenues: 13.95 billion (2017 est.)
expenditures: 19.24 billion (2017 est.)
Taxes and other revenues
17.6% (of GDP) (2017 est.)
Budget surplus (+) or deficit (-)
-6.7% (of GDP) (2017 est.)
Public debt
54.2% of GDP (2017 est.)
53.2% of GDP (2016 est.)
Inflation rate (consumer prices)
8% (2017 est.)
6.3% (2016 est.)
Central bank discount rate
10% (1 January 2017)
11.5% (1 January 2016)
Commercial bank prime lending rate
13.67% (31 December 2017 est.)
16.56% (31 December 2016 est.)
Stock of narrow money
$14.07 billion (31 December 2017 est.)
$12.77 billion (31 December 2016 est.)
Stock of broad money
$14.07 billion (31 December 2017 est.)
$12.77 billion (31 December 2016 est.)
Stock of domestic credit
$32 billion (31 December 2017 est.)
$29.88 billion (31 December 2016 est.)
Market value of publicly traded shares
$19.33 billion (31 December 2016 est.)
$26.48 billion (31 December 2015 est.)
$26.16 billion (31 December 2014 est.)
Agriculture - products
tea, coffee, corn, wheat, sugarcane, fruit, vegetables; dairy products, beef, fish, pork, poultry, eggs
Industries
small-scale consumer goods (plastic, furniture, batteries, textiles, clothing, soap, cigarettes, flour), agricultural products, horticulture, oil refining; aluminum, steel, lead; cement, commercial ship repair, tourism, information technology
Industrial production growth rate
3.6% (2017 est.)
Current Account Balance
-$5.021 billion (2017 est.)
-$3.697 billion (2016 est.)
Exports
$5.792 billion (2017 est.)
$5.695 billion (2016 est.)
Exports - commodities
tea, horticultural products, coffee, petroleum products, fish, cement, apparel
Exports - partners
Uganda 10.8%, Pakistan 10.6%, US 8.1%, Netherlands 7.3%, UK 6.4%, Tanzania 4.8%, UAE 4.4% (2017)
Imports
$15.99 billion (2017 est.)
$13.41 billion (2016 est.)
Imports - commodities
machinery and transportation equipment, oil, petroleum products, motor vehicles, iron and steel, resins and plastics
Imports - partners
China 22.5%, India 9.9%, UAE 8.7%, Saudi Arabia 5.1%, Japan 4.5% (2017)
Reserves of foreign exchange and gold
$7.354 billion (31 December 2017 est.)
$7.256 billion (31 December 2016 est.)
Debt - external
$27.59 billion (31 December 2017 est.)
$37.7 billion (31 December 2016 est.)
Stock of direct foreign investment - at home
$8.738 billion (31 December 2017 est.)
$5.317 billion (31 December 2016 est.)
Stock of direct foreign investment - abroad
$1.545 billion (31 December 2017 est.)
$335.5 million (31 December 2016 est.)
Exchange rates
Kenyan shillings (KES) per US dollar -
102.1 (2017 est.)
101.5 (2016 est.)
101.504 (2015 est.)
98.179 (2014 est.)
87.921 (2013 est.)
Fiscal year
1 July - 30 June

Source: CIA World Factbook
This page was last updated on December 7, 2019

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