• Treasury CS Ukur Yatani says the economy will grow by 2.5 per cent and could drop further to 1.8 per cent because of the coronavirus crisis.
• Companies and businesses have been forced to lay off or send employees on unpaid leave, with numbers running into thousands. Treasury Cabinet Secretary Ukur Yatani receives the 2020 Economic Survey Report from National Bureau Statistics Zachary Mwangi at the Treasury on April 28, 2020 Kenyans should brace themselves for tough economic times as the National Treasury moves to downgrade this year’s growth to a possible 1.8 per cent, after growing 5.4 per cent last year.
Economic growth dropped to 5.4 per cent in 2019 compared to 6.3 per cent the previous year, the Economic Survey 2020 indicates, amid an irony of increased jobs.
Some 846,300 new jobs were created last year, compared to 840,000 new jobs in 2018.
"The informal sector is estimated to have created 767,900 new jobs in 2019 compared to 744,100 new jobs in 2018,” National Treasury CS Ukur Yatani said on Tuesday.
According to the Kenya National Bureau of Statistics, employment in the modern sector recorded a growth of 2.4 per cent in 2019 compared to 2.8 per cent in 2018.
In the year under review, 67,800 jobs were created in the formal sector.
The CS has, however, revised downwards this year’s economic growth from a previous projection of 6.2 per cent, saying it is likely to decline to 2.5 per cent and even possibly slump to 1.8 per cent.
This is on the back of the current slowdown in major sectors of the economy that have suffered the brunt of the coronavirus, with tourism, aviation, and non-food retail sectors facing the highest exposure to financial distress.
Manufacturing, chemicals, media, oil and gas, mining, and agriculture are also feeling the impact of the crisis, which has hit the local economy hard. The government has cut on its spending to channel funds towards containing the virus.
“All the sectors have been affected,” Yatani said during the release of the Economic Survey in Nairobi, adding, “There is a lot of loss of jobs."About 5,000 people in the flower sector and more than 10,000 in the hospitality industry have so far been affected.Tens of companies and businesses also have been forced to either lay off or send employees on unpaid leave, with numbers running into thousands.Inflation was at 6.06 per cent by the end of March, compared to January’s 5.78. […]
