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IMF revises Kenya's 2016 growth estimate

Friday November 6 2015

International Monetary Fund (IMF) resident representative Armando Morales during the launch of the 2015 Regional Economic Outlook for Sub-Saharan Africa report at The Norfolk Hotel on May 18, 2015. Mr Morales said that IMF has lowered Kenya's 2016 economic growth projection. PHOTO | DIANA NGILA \ NATION MEDIA GROUP

International Monetary Fund (IMF) resident representative Armando Morales during the launch of the 2015 Regional Economic Outlook for Sub-Saharan Africa report at the Norfolk Hotel on May 18, 2015. PHOTO | DIANA NGILA | NATION MEDIA GROUP 

BRIAN NGUGI
By BRIAN NGUGI
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The International Monetary Fund (IMF) has lowered Kenya's 2016 economic growth projection.

IMF Kenya representative Armando Morales said Thursday that the multi-lateral lender has trimmed the country's projection down to 6.8 per cent, from the initial 7.2 per cent, owing to the prevailing harsh economic conditions.

“The revision of the (economic growth) will be probably downwards because the situation globally and regionally is more negative; we don’t expect a major revision,” Mr Morales said, during the release of the lender's Regional Economic Outlook for Sub-Saharan Africa report in Nairobi.

Also in September, IMF revised downwards Kenya's 2015 economic growth projection from 6.9 per cent to 6 per cent, citing the depreciating shilling and the suffering tourism sector.

The government too , in April, cut its own 2015 economic growth projection from 6.5 per cent down to 5.3 per cent.

However, Mr Morales said Kenya is expected to be resilient against continued volatility in the global market because of its structural advantages in the economy.

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He said: “We still expect Kenya will continue growing comfortably. The region is affected by several shocks but Kenya has an advantage in that the budget is not linked to oil prices and China is not one of its main export markets.”

The IMF representative maintained that the country’s debt situation is still sustainable, saying Kenya is still far from alarming “stress risks” at below a 50 per cent of the debt to GDP ratio.