Kenya's economic growth expected to slow down

29 June 2022 - Kenya’s growth is expected to slow down in 2022. As per the World Bank, the country’s GDP is expected to grow by 5.5% in 2022. While this growth rate is still strong, it is not comparable to the remarkable economic growth after the Covid-19 pandemic. A report by NCBA Bank Kenya has reported that a key reason for the slowing down of the economy is the worsening of the current drought in the region. This has had devastating effects on the livelihoods and food security of those living in the affected areas. 

It is estimated that below-average rains will not only worsen the food security in Kenya but also hamper agricultural performance. Therefore, job security for farmers will also decrease in the region. Furthermore, another reason for the cost of living increase in Kenya is because of the war in Ukraine. Commodity prices, especially fuel, fertiliser, wheat, and other food imports, have risen exponentially due to the war. Global oil prices are also at the highest since the 2008 global recession. 

Increased social spending on food assistance

This crisis is necessitating increased social spending on food assistance for affected citizens in the country. Food and gasoline inflation is especially expected to remain high in 2022 owing to the disruptions in global food supply networks and other management costs. 

Cash-starved consumers have had to pay more for food and fuel items as the conflict in Ukraine, drought, climate change, and lingering effects of the Covid-19 pandemic have made the cost of living increase to unbearable prices for many families in Kenya. Non-profit organisations in Kenya have urged governments to put food and fuel subsidies in place to make the cost of living manageable. Take our Cost of Living survey and contribute to the wage information in Kenya.