Kenya’s economy is expected to grow by 7.0 per cent in 2021 on account of the resumption of international trade and strategic investments in the country’s development priority areas, according to an official.
Ukur Yatani, Cabinet Secretary for the National Treasury disclosed this in a statement issued in Nairobi on Wednesday.
The statement comes Yatani after held talks with Abebe Selassie, Director of the Africa Department at the International Monetary Fund (IMF).
The cabinet secretary said the economy which grew by 0.6 per cent in 2020 due to the triple threats of the Coronavirus (COVID-19), locust invasion, and floods would also be buoyed by stable inflation, interest, and forex rates as well as growth in private-sector lending as well as the credit guarantee scheme for small and medium enterprises.
“The agricultural sector’s strong performance, alongside the government’s rapid deployment of the Economic Stimulus Programme coupled with tax reliefs, went a long way in driving the resilient economic performance,” he said.
The World Bank has predicted Kenya’s economy to grow at 6.9 per cent in 2021.
It said continued support from lenders in terms of public health interventions to the private sector was likely to spur Kenya’s strong economic growth.
Yatani said Kenya’s tourism, trade, transport, educational, and manufacturing sectors were adversely affected by COVID-19, the locust invasion as well floods in 2020, but the country managed nonetheless to register a growth of 0.6 per cent on the back of a strong performance by the agricultural sector as a result of good rainfall.
He said the budget deficit for 2020/21 is at 8.7 per cent of Gross Domestic Product (GDP) but will contract to 7.5 per cent of GDP in 2021/22 and settle at 3.6 per cent of GDP.
This, the Kenyan official said, would be on the back of a solid fiscal consolidation effort pegged on raising revenue; reducing waste and inefficiency; and ring-fencing development spending. (Xinhua/NAN)