Kenya’s Real Gross Domestic Product (GDP) grew by 4.0 percent in the third quarter of 2024, down from 6.0 percent growth in the same period in 2023 because of falling industries.
GDP, which is the most widely used indicator of a country’s economic performance, represents the total value of all final goods and services produced within the economy over a specified period.
The latest Kenya National Bureau of Statistics (KNBS) quarterly gross domestic product report has detailed that the drop in growth was caused by a general decline across many sectors of the economy.
Further, the macroeconomic performance report explained that the decline in revenue generated by some sectors of the economy influenced the downward trajectory.
Two major industries experienced a decline including the construction sector which shrank by 2.0 percent. On the other hand, the mining and quarrying industry recorded an 11.1 percent decrease.
Also Read: Why Kenya’s GDP Growth Slowed in 2024- CBK
Industries that Recorded an Increase
On the flip side, six industries contributed to the growth of Kenya’s economy in the third quarter. The highest growth came from Accommodation and Food Service Activities which recorded a 13.7 percent growth.
Additionally, the Transportation and Storage sector came in second with a 5.2 percent increase, while the Real Estate industry recorded a 5.5 percent increase.
Other strong-performing sectors included Wholesale and Retail Trade which recorded a 4.8 percent growth, the Financial and Insurance sector which recorded a 4.7 percent growth and the Agriculture, Forestry, and Fishing industry which recorded a 4.2 percent growth.
Meanwhile, inflation dropped significantly during the same period. The average inflation rate stood at 4.08 percent in the third quarter of 2024, a decrease from 6.93 percent in the same period in 2023.
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The lower inflation was recorded because of reduced prices for food and non-alcoholic beverages, offering some relief to households and businesses.
Also Read: Where is the Money? Why Kenyans Don’t Feel the Effects of Economic Growth in Their Wallets
Second Quater Report
A KNBS report released in October 9, detailed that Kenya’s GDP growth had slowed down in the second quarter of 2024 compared to the same period in 2023.
The Central Bank of Kenya (CBK) Governor Dr Kamau Thuggeat the time reported that Kenya’s GDP growth in the second quarter of 2024 stood at 4.6 percent, a decline from 5.6 percent recorded in the second quarter of 2023.
Dr. Thugge attributed the reduced growth rate to a slowdown in several key sectors of the economy, highlighting contractions in construction, mining, and quarrying activities.
“The projected growth rate for 2024 has been adjusted downwards to 5.1 percent from the earlier estimate of 5.4 percent, reflecting the second quarter’s performance, which indicated a general deceleration in growth,” Dr Thugge stated.
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