Kenya

CBK Survey Shows High Optimism on Economic Growth in 2022 as Key Sectors Continue to Recover.

Data from the Central Bank of Kenya (CBK) shows top CEOs in Kenya are optimistic about business growth this year, largely driven by the services sector, improved consumer demand, lower inflation and easing of the COVID-19 restrictions.

This is according to a survey by the Central Bank which however indicates that the business leaders are concerned that increased political activity, Covid-19 risks and rising input costs could slow business growth.

The Monetary Policy Committee surveyed opinions about expectations about inflation, the economy, lending rates, levels of operations by companies, and private sector credit growth.

CEOs told the Central Bank of Kenya (CBK) that they are optimistic that businesses will grow this year anchored by improved consumer demand, lower inflation and the lifting of the COVID-19 restrictions.

The business leaders said there was an improvement in business activity highlighted by growth in sales on account of strong business prospects especially for professional services, spill-overs of some sales from the last three months of last year, and increasing business opportunities in the region.

However, the top CEOs are concerned that business growth may slow on account of Covid-19 risks, increased political activity ahead of the August polls and global supply chain disruptions.

Business leaders in the agriculture and manufacturing sectors told CBK they were concerned over the rising input costs, which they expect to persist especially for imports where supply chain constraints will continue.

Even though they are expecting political stability around this year’s general election, the CEOs fear that increased political activity could lead to scaling down of operations as businesses adopt a “wait and see approach” to investments.

The top CEOs expect to mitigate constraints in the economic environment by managing costs and risks, diversifying their businesses and digitizing their operations.

Also Read: CBK Retains Benchmark Rate at 7% backed by Recovering Economy