Economy
Agriculture rebound speeds up Q3 economic growth
Friday December 29 2023
A farmer inspects his potato farm in Elburgon, Nakuru on November 9, 2023. Rebound in agriculture has accelerated the growth of the economy in quarter ended September. PHOTO | JOHN NJOROGE | NMG
A continued rebound of the agriculture sector has lifted economic growth in the quarter that ended September to 5.9 percent from 4.3 percent in similar period in 2022.
Data from the Kenya National Bureau of Statistics (KNBS) shows growth in the period was the fastest inside six quarters as the agriculture sector continued unwinding itself from a contraction.
The sector recovered from a 1.3 percent contraction in September last year to grow by 6.7 percent, gaining dividends from improved weather conditions in 2023.
“The improved performance was attributed to favourable weather conditions that characterised the first three quarters of 2023,” KNBS said on Friday.
Fruit exports rose by 84.3 percent in the three months to 59,648 metric tonnes, while vegetable exports were up by 35.4 percent.
Meanwhile, tea production improved by 28 percent to stand at 138,771 metric tonnes.
Financial sector
The financial sector benefitted from the tightening of monetary policy by the Central Bank of Kenya to grow by 14.7 percent from 9.6 percent last year.
“The cost of credit issued by commercial banks went up during the third quarter with average interest rates on loans and advances increasing to 13.98 percent in September from 12.41 percent in September 2022,” KNBS added.
Growth in accommodation and food service meanwhile rebounded to 26 percent from 16.9 percent on the acceleration of visitor arrivals, which were largely tied to Kenya playing host to the Africa Climate Summit Conference.
Manufacturing grew by 2.6 percent in the period from 1.8 percent previously from improved agro-processing as the output of dairy and tea products rebounded.
Electricity supply, transportation, storage, information and communication sectors marked a deceleration in growth in the quarter with the communication witnessing a slump in the use of domestic short messaging services.
The deceleration in transportation and storage services was tied to the reduction in consumption of light diesel, which fell by 2.3 percent to 557,600 metric tonnes in the quarter.
Growth in electricity supply tanked on reduced thermal and wind power generation.
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