IMF expects Kenya’s economic expansion to slow as pandemic persists

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NAIROBI, Kenya, May 18-The International Monetary Fund revised Kenya’s economic expansion to 6.3 percent from the previous projection of 7.6 percent.

In a statement, the IMF said this was influenced by the third wave of the coronavirus pandemic which continued to slow the country’s economic activities.

“The economic recovery is expected to be sustained, although the persistence of the pandemic suggests that the recovery expected in 2021 will be slightly weaker than expected. IMF staff are now forecasting economic growth of 6.3% in 2021, ”said the IMF press release.

“The shock of the coronavirus has unfortunately also reversed some of the poverty reduction gains Kenya has made in recent years and the debt remains high,” he added.

However, the IMF has maintained that Kenya’s outlook is strong and that over the medium term, growth is expected to reach its potential of just over 6 percent.

This follows a recent International Monetary Fund (IMF) team led by Mary Goodman who carried out a virtual mission to Kenya from April 29 to May 14, 2021, to discuss reform progress and the authorities’ political priorities in the context of the first review of Kenya’s economic program supported by the IMF’s EFF and CEF agreements.

Various sectors of the economy such as transport, school, hospitality and tourism have been disrupted since the outbreak of the coronavirus pandemic in March 2020.

At the same time, several companies laid off their employees while some preferred to put the rest on a cut or on unpaid leave.

Kenya’s economy shrank 5.7% in the second quarter of 2020.

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