As usual, New Year resolutions for most Kenyans revolve around financial independence. Most of them, more than a third, indicated that they would like to start a new business, according to an end-of-year poll by research firm TIFA. Another 17 per cent want to get a new job, while 13 per cent have cast their sights on owning a home. Similarly, another 13 per cent want to pursue higher education. For respondents who told the pollsters that 2019 was a bad year, they know all too well that it is going to take a lot of effort for them to realise their goals. They will need the money and good ideas to start their own businesses or build their own homes. Businesses will also have to be doing well to employ those who need jobs. And perhaps the best time to tell whether the economy will smile at you in the year is to look at how leading economic indicators performed at the start of the year. Gross Domestic Product (5.1 per cent) Towards the end of last year, the Kenya National Bureau of Statistics (KNBS) released the economic performance figures for the period between July and September (third quarter of 2019). The economy, measured by adding up the value of all the goods and services produced – technically known as the gross domestic product (GDP) – expanded by 5.1 per cent. This was slower growth compared to a similar period in 2018. Most institutions, including the Treasury, Central Bank of Kenya, the World Bank and International Monetary Fund, expected GDP to be slower in 2019 compared to the previous year. But they expect the economy to bounce back this year. Inflation (5.8 per cent) Should the prices of goods and services increase too much this year, you will not have enough money to set aside as capital for your business or for building that new home. So watch out for inflation – the rate at which average prices of a basket of goods and services will increase. Prices in December 2019 increased by 5.8 per cent, which was higher compared to 5.56 per cent in November. If you are saving for a house, high inflation will eat into your savings. But in case of higher inflation, those who are servicing their loans might have it easier. Exchange rate (100.95) For those wishing to start a business this year, […]
