Kenya’s economy grew 5.4% in Q2’2023, an increase from 5.2% in Q2’2022. Compared to Q1’2023, the economy slowed from 5.5%.
More importantly, the annual quarterly uptick in GDP growth primarily rests on the sharp recovery in Kenya’s agricultural sector, which expanded by 7.7% from -2.4% in the corresponding period in 2022.
Stears unpacks Kenya’s latest GDP numbers, doubling down on the agricultural sector, the biggest contributor to GDP (~21%).
Sector breakdown
Of the sixteen economic activities tracked in Kenya’s GDP report, only five sectors (agriculture, real estate, health, education and public administration) expanded in Q2’2023 compared to Q2’2022. Eleven sectors, including manufacturing and ICT, slowed, albeit marginally. In 2022, growth declined across all of the sixteen sectors.
A few factors causing the slowdown in the growth of almost 70% of Kenya’s sectors are the shilling’s depreciation, falling consumer demand, seasonality and higher operating costs.
Take the manufacturing sector, for instance. With the
