Answer to Question #230151 in Macroeconomics for shii

Question

 

With specific reference to the current state in Kenya as at 30^th June 2021, discuss the macroeconomics state of Kenya in relation to inflation and interest rates and how the same has affected the operations of the economy 

Answer 1

Kenya continues to face significant challenges to sustainable and inclusive economic growth, which have been exacerbated by COVID-19’s economic disruptions, alongside long-running challenges including corruption and economic inequality. Two-thirds of the Kenyan population lives in poverty below $3.20 per day and have since independence.

The economy of Kenya is projected to expand 6.6% in 2021 from an estimated growth of 0.6% in 2020, estimates from the country's National Treasury showed. That would be the highest growth rate since at least 2013, driven by a rebound in services activity following the reopening of key industries such as hotels and restaurants and as international travel resumed helped by the easing of COVID restrictions. Still, growth will depend on "the progress of the vaccination effort, macroeconomic stability and implementation of the projects” aimed at boosting health care, housing, manufacturing, and food security.