After experiencing slow growth like anywhere in the world in 2019, Kenyan economy is expected to bright in the new year, 2020.
The slow growth was due to international pressure like U.S – China trade wars, and interest cap law that led to shrunk credit to the private sector.
Earlier, world bank had focussed the economy to hit 5.8% in 2019, down from 6.3% in the year 2018. This was blamed on lower agricultural output and weak investments in the private sector.
Kenya National Bureau of Statistics show that economy grew by 5.6% in the second quarter compared to a 6.4% in the same period in 2018.
High tax regime, credit and tensions in the international markets and its negative impacts both in corporate and small business enterprises. Many closed shops and many were rendered jobless.
Many listed firms issued profit warnings including CIC insurance which is the latest to issue such warnings.
There were also tax warnings that saw many gambling and betting firm quit the Kenyan market including betting giants, Sportpesa and Betin.
2019 was also worsened by huge spending by the government and private sectors and choking money to suppliers.
That led to many small businesses that feed the economy closing down shops or being auctioned.
2020 will be bright
The year 2020 is expected to brighten, many positive factors are seen to help the economy accelerate.
The repeal of the interest cap law in November and heavy rainfall experienced in the last months of year 2019 should ensure food security, affordable electricity and good government policies that will boost small businesses.
The scrapping of interest law will enhance credit flow to the private sector , create jobs and improve income to many households.
The new year is also expected to experience a calm political environment. This should be continuation of the environment brought about by handshake and BBI pact between President Uhuru Kenyatta and opposition chief Raila Odinga.
There are no major political and social events planned for 2020 that might affect the relative peace.
Therefore tourism will perform better and earn the country the much needed and important forex.
The President’s order to state agencies to clear pending bills will increase capital supply in the economy and lead to expansion of businesses.
The government’s heavy investment in infrastructure, road network, railway and technology will also aide expansion of businesses.
There is also growing trade effectiveness that has seen the country climb rankings in World Bank’s ease of doing business to position 56 out of 190 in the year 2019.
The grow is expected to improve further in 2020.