Kenya’s economy grew by 4.7% in 2024, marking the slowest pace of expansion since 2013, according to the Kenya Economic Survey 2025. Officials and analysts attributed the slowdown to a deceleration following a strong rebound in 2023, with continued weakening confirmed by the Kenya National Bureau of Statistics and international institutions.
The Kenya National Bureau of Statistics (KNBS) confirmed the trend, reporting a further slowdown to 4.6% growth in 2025, signaling continued weakening of the economy. Analysts and institutions attributed the deceleration to a combination of domestic shocks and subdued business conditions following a strong rebound in 2023.
Kenya’s 4.7% GDP growth in 2024 marked the slowest expansion since 2013, excluding the pandemic year of 2020, according to the Kenya Economic Survey 2025.
The World Bank’s Kenya Economic Update, released on May 27, 2025, noted that the overall pace of economic growth had slowed despite improvements in some macroeconomic indicators such as inflation and foreign reserves. The World Bank projected real GDP growth to increase gradually from 4.5% in 2025 to about 5.0% in 2026 and 2027, reflecting a weaker growth trajectory. It identified multiple challenges behind the slowdown, including severe floods, high interest rates, protests in mid-2024, reduced development spending, weak industrial activity, sluggish private consumption, and policy uncertainty that constrained investment and formal employment growth.
Lloyds Bank, citing International Monetary Fund estimates, described 2024’s 4.7% growth as a deceleration from the 5.6% expansion in 2023. It linked the slowdown to severe floods in 2024, subdued business sentiment following protests, and cuts in public spending. The bank also reported that inflation fell from 7.7% in 2023 to around 5.1% in 2024, enabling Kenya’s central bank to reduce its benchmark lending rate by 75 basis points to 11.25% in December 2024 to support growth. Despite the slowdown, Lloyds Bank noted that Kenya’s GDP per capita (PPP) stood at $7,157 in 2024, with the international poverty rate at the $2.15 threshold declining from 35.8% in 2022 to 34.7% in 2023.
Sectoral performance during the slowdown showed mixed results. The World Bank reported that agriculture remained resilient and remittance inflows were strong, while services rebounded. However, weaknesses in industry and consumption offset these positives. KNBS data cited by Trading Economics showed that in the fourth quarter of 2025, the agricultural sector contracted by 1.3% year-on-year after growing 3.8% in the previous quarter, reflecting lingering drought effects. Other sectors such as tourism, information and communication, and transport experienced softer growth, while construction rebounded. The Economic Survey 2025 indicated that agriculture contributed 22.5% to nominal GDP in 2024, highlighting its stabilizing role despite overall slowing growth. Private consumption remained the main driver of the economy, accounting for 76.9% of GDP in 2024, while industrial investment stayed weak.
The World Bank also highlighted fiscal and external sector constraints. Kenya’s public debt remains at high risk of distress, with interest payments absorbing about one-third of tax revenue, limiting fiscal space to counteract the slowdown. The current account deficit narrowed to 3.1% of GDP in the 12 months to February 2025, supported by a rebound in exports—particularly agricultural goods and re-exports—and strong remittance growth of 19%. These factors partially offset domestic economic weaknesses.
Historical data show that Kenya experienced robust economic expansion in the 2000s and 2010s before a pandemic-induced contraction in 2020. Growth rebounded strongly to 7.5% in 2021 and 5.6% in 2023 but slowed to 4.7% in 2024. Projections for 2025 and 2026 anticipate growth around 5%, indicating a moderate recovery rather than a return to earlier high rates, according to Lloyds Bank and World Bank forecasts.
Looking ahead, the World Bank emphasized the importance of reforms to strengthen fiscal sustainability, enhance revenue growth, and promote inclusive growth and job creation to revive the slowing economy and weak labor market. It suggested that well-targeted value-added tax reforms, expanded cash transfers, and investments in health and education could create fiscal space and transform fiscal policy into a tool for poverty reduction and employment generation amid subdued GDP growth. Analysts reviewing the Economic Survey 2025 noted that although 2024’s growth was the weakest since 2013 (excluding 2020), consumer demand remained strong and agriculture showed signs of recovery, indicating potential for a return to higher, more sustainable growth if investment and industrial activity improve.
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