Economic indicators point to reduced growth

Economic growth could decelerate to 5.1 per cent this year from 5.6 last year, due to unfavourable weather conditions and rising food and fuel prices.

Dr Edward Sambili, permanent secretary in the ministry of Planning, said this, noting that in agriculture, tea production, which is among the leading foreign exchange earners, dropped by 7.3 per cent in the first four months of 2011 from 137,833 metric tonnes last year to 127,858 metric tonnes this year.

The PS, who was presenting the latest economic indicators during the National Economic and Social Council meeting in Naivasha recently, said that in terms of value, tea dropped from Sh32.6 billion to Sh31.9 billion.

“As a result of lower production in the earlier part of this year, the Kenya Tea Board projects a 9.3 per cent decline in total export volume from 440 million kilogrammes last year to 399 million kilogrammes this year,” he said.

Dr Sambili added that milk production declined by 11 per cent this year compared to a similar period in 2010, with projections by the Kenya Dairy Board indicating a 5 per cent decline in annual output.

There is, however, reprieve in coffee and sugar cane production, as well as in manufacturing, since production went up.