Did It Grow Or Just An Illusion? Key Highlights From The Economic Survey

The Kenya National Bureau of Statistics (KNBS) released the Economic Survey 2022, highlighting that the economy expanded by 7.5 percent in 2021, from the 0.3 percent contraction that was recorded in 2020.

The survey also indicated that the Nominal GDP grew by 12.9 percent to 12.1 trillion shillings in 2021, from 10.7 trillion shillings in 2020.

Here are some of the key highlights:

Public Debt:

The total stock of public debt rose by 14.9 percent to 7,188.1 billion shillings in June 2021 from 6,254.4 billion shillings as of June 2020, with public external debt accounting for 53.5 percent of the total debt.

In FY’2021/22 a total of Kshs 1,094.0 bn is expected to be spent on servicing public debt, a 53.4% increase from 713.3 billion shillings in FY’2020/2021. This translates to debt service to GDP of 9.0% in FY’2021/2022, up from 6.7% in FY’2020/2021.

Employment:

During the year, total employment outside small-scale agriculture and pastoralist activities grew by 5.3 percent to 18.3 million in 2021 from 17.4 million in 2020 as firms sought to clear the backlog and as the economy recovered.

The total number of self-employed and unpaid family workers within the modern sector remained relatively unchanged at 0.2 mn in 2021 as was recorded in 2020.

The informal sector accounted for 81.4 percent of total employment outside of small-scale agriculture and pastoralist activities while the formal sector accounted for 18.6 percent of the total employment.

Money Supply:

The broad money supply increased by 6.1 percent to 4,235.2 billion shillings in December 2021 from 3,990.0 billion shillings in December 2020.

Total domestic credit grew at a slower rate of 15.1 percent compared to a growth of 18.5 percent seen in 2020, partly attributable to slower growth in credit extended to the National Government of 29.3 percent compared to a growth of 50.9 percent as at end of December 2020.

Liquidity:

Quasi money, money supply (M2), broad money supply (M3), and overall liquidity grew by 3.5, 5.6, 6.1, and 9.5 percent respectively in the review period,

Imports & Exports:

Total exports increased by 15.5 percent to 743.7 billion shillings in 2021, from 643.7 billion shillings in 2020, mainly on account of the increased value of domestic exports such as horticulture.

On the other hand, imports grew by 30.9 percent to 2,151.2 billion shillings, from 1,643.6 billion in 2020. As a result, the balance of trade widened by 40.8% to a deficit of Kshs 1,407.6 bn in 2021, from 999.9 bn in 2020. The total value of trade transactions declined to Kshs 2,287.3 bn, from Kshs 2,403.0 bn in 2020, and,

Balance of Payments:

The overall Balance of Payment position improved to a deficit of Kshs 20.4 bn, from a deficit of Kshs 152.5 bn in 2020, partly attributable to the reopening of economies which saw an improvement in international trade, and,

Current Account:

The current account balance deteriorated to a deficit of Kshs 663.8 bn in 2021 from a deficit of Kshs 510.1 bn in 2020. The current account deficit as a percentage of GDP came in at 5.5% in 2021, in comparison to the 4.8% recorded in 2020.