Kenya’s economy is projected to grow by 6 per cent during the 2017 to 2020 period, a UK accounting body has said.
The Institute of Chartered Accountants in England and Wales (ICAEW) in its report, Economic Insight: Africa Q1 2016, also projects growth in African economies to average over 4 per cent over the next five years.
But while the global accountancy and finance body points to good news for African economies, it warns that manufacturing, a crucial engine for the economy, still accounts for a small share of output and says the old model of exporting raw materials is becoming unsustainable.
“In the East Africa region Kenya’s economy should to expand by around 6 per cent during the 2017 to 2020 period. Thanks to its relatively diversified economy and comparatively low commodity dependence bonding well with the country’s economic growth outlook,” says the report.
ICAEW Middle East, Africa and South Asia Regional Director Michael Armstrong added that to shore up the massive growth Africa’s economies need to create “a hospitable environment for companies in the manufacturing and services sectors to drive growth, as the old models of growth driven by exports of raw materials are out-dated.”
Macro Consulting Oxford Economics associate director Tom Rogers, who participated in the study, said African economies must improve their fiscal positions to underpin confidence in public finances and economic stability.
“The government’s recognition of these economic concerns will be needed to address these issues and instil some confidence in the country’s economic outlook,” said Mr Rogers.