- Kenya’s economy grew by 4.0% in Q3 2024, the slowest rate since Q4 2022.
- Growth declined from 4.6% in Q2 2024 and 6.0% in Q3 2023.
- Key drivers: agriculture (4.2%), real estate (5.5%), and transport & storage (5.2%).
- Construction and mining were the only sectors that contracted.
- Services remain the dominant sector, comprising 60% of the economy.
- Industrial and non-service sectors face growth challenges due to high input costs.
The Kenya National Bureau of Statistics (KNBS) revealed that the economy expanded by 4.0% in Q3 2024, marking a significant slowdown compared to 4.6% in Q2 2024 and 6.0% in Q3 2023. This represents the lowest quarterly growth since Q4 2022, reflecting subdued activity across key sectors.
Sectoral Contributions to Growth
- Agriculture (4.2%)
Agriculture remained a critical growth driver despite slower performance than previous quarters. - Real Estate (5.5%)
The sector posted steady growth, benefiting from ongoing investments and increased demand for housing and commercial spaces. - Transport & Storage (5.2%)
Transport grew at a faster pace, driven by increased light diesel consumption as fuel prices eased.
Sectors in Decline:
- Construction and Mining: Both sectors experienced contractions, reflecting weaker activity and elevated input costs.
Economic Composition and Challenges
The services sector continues to dominate the economy, contributing approximately 60% to GDP, followed by the primary sector. The industrial sector lags significantly, highlighting untapped potential in non-service areas.
Persistent challenges, including high production costs and inefficiencies, hinder growth in industrial and non-service sectors. Addressing these challenges is crucial to diversifying Kenya’s economic base and fostering sustainable growth.
Kenya’s 4.0% GDP growth in Q3 2024 highlights slowing economic momentum amid sectoral challenges. While services remain dominant, unlocking growth in agriculture, industrial, and other non-service sectors will require strategic interventions to address inefficiencies and enhance competitiveness. As Kenya navigates these economic hurdles, targeted reforms will be essential to bolster resilience and drive inclusive growth.
