Kenya’s economy expanded at its fastest pace in more than two years in the second quarter of 2023.
Kenya’s Economy is estimated to have grown by 5.4% during the second quarter of 2023 compared to 5.2% in the same quarter of 2022, according to the Kenya National Bureau of Statistics (KNBS) Quarterly Gross Domestic Product Report.
This acceleration was primarily driven by a significant turnaround in the agriculture sector, which recorded an impressive growth of 7.7%, marking its fastest pace since 2020.
The quarterly GDP report reflects the overall and sectoral performance of the economy.
The surge in the agriculture sector played a crucial role in driving overall economic growth, compensating for a slowdown in other sectors.
All economic sectors experienced growth, albeit at a slightly subdued pace, including manufacturing, electricity and water supply, construction, accommodation, transport and storage, as well as finance and insurance, KNBS reported.
A key factor contributing to the resurgence of the agriculture sector was improved weather conditions, which ended a two-year cycle of drought.
“The performance was primarily on account of favourable weather conditions, which resulted in increased agricultural production with the growth being particularly evident in the production of tea, coffee, vegetables, fruits and milk,” the Kenya National Bureau of Statistics noted on Thursday.
Tea production surged by an impressive 15.2%, reaching 155,500 tonnes, while coffee exports saw a robust increase of 13.7%, reaching 18,900 tonnes in the second quarter of 2023.
There was also an upswing in fruit and vegetable export volumes and increased milk intake by processors.
The growth in agricultural production not only strengthens the country’s economic performance but also has positive ripple effects on employment and livelihoods, particularly in rural areas where agriculture is a primary source of income.
However, despite the overall positive trend, there were specific setbacks noted in cut flower and sugarcane production during the period under review.
Sugarcane deliveries witnessed a significant decline, plummeting to 1.25 million tonnes from 2.156 million tonnes in the quarter ending June 2022.
Meanwhile, Kenya’s tea exports volume shrunk by 18% in the first seven months of 2023 compared to the same period in 2022 as some key markets refrained from purchasing due to global economic challenges.
The Tea Board of Kenya (TBK) reported that export volumes stood at 224,807 tonnes, a decline from 274,830 tonnes during a similar period in 2022.