Kenya's economy to grow at 3.5p.c

Kenya’s economy is projected to grow at 3.5 per cent this year on the back of a booming services sector and resilient construction industry.

According to the World Bank’s, Kenya Economic Update report released on Thursday, the economic growth is projected to further improve to 3.5 per cent in 2010.

World Bank said the growth trend was against the tide, which has seen many countries register decline in growth rates this year. “The good news is that Kenya is one of the few countries in the world that will grow faster in 2009 than it did in 2008.” said Johannes Zutt, the Bank’s country director for Kenya. “Despite many challenges the economy remains resilient to the quadruple shocks. The financial position remains strong, financial sector is robust, external sector remains in balance and inflation has declined to below 10 per cent.” said Mr Wolfgang Fengler, the bank’s lead economist.

Industry is projected to grow at 3 per cent driven by the construction boom.

Tourism, which registered a massive 36 per cent decline following the election crisis last year is expected to rebound 28 per cent.

Other sector that have registered growth are information communication technology at 28 per cent and telephony at 35 per cent. The arrival of two fibre optic cables is expected to further increase internet connectivity with the telephony, particularly cellular phones fast expanding to the rural areas.

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