COVID19: Kenya’s Economy to Suffer Worst Year, Says Citi
The East Africa region will experience a slowed economic growth in 2020 due to the measures imposed by the government in its efforts to curb the spread of covid19.
Report by the International Monetary Fund (IMF) projects a 1% economic growth for Kenya in the year 2020, while Ethiopia, Rwanda, and Uganda are to expand by 3-3.5%.
Kenya will be hit as compared to other East African countries due to its strong links to the international markets. Citi Research report indicates that Mombasa is a crucial entry point for international trade in the region.
Currently, the port has recorded the lowest number of cargo movement, a clear indication that economic growth will lag.
Global remittances are projected to drop by a more significant margin, hence negatively affecting the Kenyan economy. The country receives the largest share of diaspora remittances in the region.
According to the Citi Research report, the informal sector and agriculture will play a key role in supporting the economic growth to hit their forecast of 2.9% by the end of 2020.
IMF and Citi Research, however, predict an economic boom in 2021, basing their conclusion on the low numbers reported on COVID19 in the region in comparison to Europe.