Gen Z Protests Takes A Hit On Kenya’s Economy as GDP Drops to 4.9pc

Kenya’s economy grew by 4.7pc last year which is lower than earlier projections weighed down by various negative shocks including Gen-Z protest which erupted over the contentious finance bill 2024.

Latest data by the Kenya National Bureau of Statistics (KNBS) shows that real gross domestic product (GDP) registered last year was lower than 5.7pc posted in 2023 on account of internal and external shocks which lead to slowdown as well as contraction of key economic sectors.

According to the National Treasury and Economic Planning Cabinet Secretary John Mbadi, last year, the country struggled with constrained fiscal space owing to lower tax revenues, high interest rates which push up debt servicing costs, anti-finance bill demonstrations which led to withdrawal of the bill as well as bad weather which affected agriculture output.

“When we started the financial year 2024/2025, we had projected economic growth of not less than 5.3pc but because of the shocks, we have only been able to realize 4.7pc economic growth,” said John Mbadi, National Treasury.

In twelve months to December last year, agriculture, forestry and fishing posted a slow growth of 4.6pc compared to 6.6pc registered the previous year while financial and insurance activities posted 7.6pc growth compared to 10.1pc posted in 2023.

“These negative shocks have impacted economic activities that increased the cost of living underscoring the need for robust, targeted intervention,” added Mbadi.

Other sectors which reported slow growth include transport and storage which expanded by 4.4pc compared to 5.5pc and real estate sector which grew by 5.3pc compared to 7.3pc reported in 2023.

However, mining and quarrying and construction sectors witnessed a contraction of 9.2pc and 0.7pc respectively.

The reduction in mineral output from Ksh 33.8 billion to Ksh 25.5 billion last year was on account of closure of Base Titanium operation in Kwale County. This reduced the value of titanium ore and minerals from Ksh 24.2 billon to Ksh 17 billion last year.

“Titanium alone when it comes to production of our mineral accounts for 65pc. This reduction or stoppage at some point reduces what is coming from mining industry,” said Dr Macdonald Obudho, KNBS Director General.

However, the survey shows that Kenya added more than Ksh 1 trillion to the economy last year as nominal GDP grew from Ksh 15 trillion to Ksh 16.2 trillion with agriculture, forestry and fishing sector contributing 22.5pc.

GDP per capita income also increased to Ksh 309,460 from Ksh 291,770.