Economy of Kenya - Gross Domestic Product (GDP)

Gross Domestic Product (GDP)

In 2006 Kenya’s GDP was about US$17.39 billion. Per capita GDP averages somewhat more than US$450 annually. Adjusted in purchasing power parity (PPP) terms, per capita GDP in 2006 was about US$1,200. The country’s real GDP growth picked up to 2.3 percent in early 2004 and to nearly 6 percent in 2005 and 2006, compared with a sluggish 1.4 percent in 2003 and throughout President Daniel arap Moi’s last term (1997–2002). Real GDP is expected to continue to improve, largely because of expansions in tourism, telecommunications, transport, and construction and a recovery in agriculture. The Kenya Central Bank forecast for 2007 is between 5 and 6 percent GDP growth. GDP composition by sector, according to 2004 estimates, was as follows: agriculture, 25.7 percent; manufacturing, 14.0 percent; trade, restaurants, and hotels, 13.8 percent; transport and communications, 6.9 percent; government services, 15.6 percent; and other, 24.0 percent.

Kenya's 2010 Economic Performance and Outlook for 2011: In 2010, Kenya has seen the return of higher growth projected at 4.9 percent, and may now be at a tipping point for robust growth. Five factors are creating a positive momentum: the new constitution, EAC integration, ICT innovations, strong macroeconomic management, and recent investments in infrastructure. Services, the driver of previous years' growth, have moderated while agriculture and industry are rebounding after two weak years. ICT has been the main driver of Kenya's economic growth over the last decade, growing on average by 20 percent annually, and propelling the combined transport and communications sector into the economy's second largest (after agriculture). Since 2000, Kenya's economy grew at an average of 3.7 percent. Without ICT, growth in 2010 would have been a lackluster 2.8 percent—similar to the population growth rate—and income per capita would have stagnated. Over the last three decades Kenya has experienced only two short episodes when economic growth exceeded five percent and was sustained for at least three consecutive years: 1986-88 and 2004-2007. Economic growth in 2011-12 could range between 5.3 and 6.0 percent if no shocks occur. Public sector investments in infrastructure will help to stimulate this growth. However, the timely implementation of the constitutional reforms would also be necessary to help boost business confidence. (ref; Kenya Economic Update, December 2010, www.worldbank.org/Kenya.keu)