Kenya—Weak Governance Hobbles Economy

image of Kenya—Weak Governance Hobbles Economy

Recent economic trends in Kenya have been disappointing, with GDP growth declining since the mid-1990s and falling substantially below the population growth rate, estimated at 2.4%. In 2000 real economic growth turned negative, dropping to –0.3%—its lowest level since independence—from 1.4% in 1999 and 1.8% in 1998. These rates are far below government targets of 2.7% for fiscal 2001, 3.5% for fiscal 2002, and 5.0% for fiscal 2003. Agriculture, which traditionally accounts for the largest share of GDP, shrank 2.4% in 2000, while real manufacturing output fell 1.5%. The balance of payments worsened, with current account and trade deficits increasing. Deteriorating economic and social conditions are also reflected in other key measures. Poverty has increased, and income inequality and social indicators show worrisome trends.

Related Subject(s): Economic and Social Development
Countries: Kenya
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