Provisional estimates of Gross Domestic Product (GDP) indicate that the economy expanded by 5.7 per cent during the first quarter of 2018 compared to 4.8 per cent in a similar quarter of 2017. The significant acceleration in growth was mainly attributable to improved weather conditions and a boost in business and consumer confidence after the conclusion of general elections in 2017.
From the supply side, growth was mainly driven by a recovery in activities of Agriculture as well as improved output in Wholesale and Retail Trade, Manufacturing, and Real Estate sectors. On the other hand, Financial and Insurance; Transportation and Storage; Construction; Electricity Supply; and Mining and Quarrying recorded marked slowdown in the growth. Growth of activities in the Information and Communication was robust while Accommodation and Restaurants slowed significantly but remained relatively strong.
In the first quarter of 2018, the current account deficit improved to KSh 107.9 billion from KSh 129.7 billion in the corresponding quarter of 2017, Merchandise exports grew by 7.1 per cent to KSh 162.9 billion in the first quarter of 2018, while merchandise imports valued on free on board (fob) basis grew by 6.5 per cent to KSh 432.1 billion, in the same quarter. Merchandise trade balance (fob) worsened by 6.1 per cent from a deficit of KSh 253.7 billion in the first quarter of 2017 to a deficit of KSh 269.3 billion in the quarter under review. During the first quarter of 2018, international trade in services registered a surplus of KSh 49.3 billion from a surplus of KSh 38.5 billion in the first quarter of 2017. Receipts from international services increased by 10.8 per cent to KSh 129.4 billion in the quarter under review partly on account of improved tourism earnings. Remittances from the diaspora increased substantially in the first quarter of 2018 and boosted the secondary income to record a surplus of KSh 129.3 billion.
During the first quarter of 2018, financial net inflows increased by 51.8 per cent to a surplus of KSh 323.8 billion mainly as a result of proceeds from the Eurobond. Gross official reserves increased by 9.4 per cent to KSh 944.1 billion as at end of March in 2018 from KSh 863.0 billion as at end of March 2017. Overall balance of payments improved to a surplus of KSh 206.9 billion in the quarter under review.
The Kenya National Bureau of Statistics (KNBS) in collaboration with the Central Bank of Kenya (CBK) and the Kenya Investment Authority (KenInvest) is conducting Foreign Investment Survey (FIS) 2018 from June to August, 2018. This is the fifth survey after FIS 2010, FIS 2013, FIS 2015 and FIS 2016.
The purpose of FIS 2018 is to collect information from resident enterprises on their foreign assets and liabilities. The data collected will be used to improve the quality of data for compilation of Balance of Payments (BOP) and International Investment Position (IIP) statistics. In addition, data collected will be used for investment promotions and policy formulation.
Specific objectives of the survey are:
- To collect comprehensive information, with geographic detail, on the stocks and flows of inward and outward foreign capital.
- Apply the 2018 FIS Survey information to improve BOP and IIP Statistics;
- To collect data on foreign private debt;
- To collect data and information on foreign investment relationships for compiling Foreign Affiliates Statistics (FATS).
- To update the enterprise register necessary for carrying out sample surveys on cross-border- financial transactions;
- To improve the quality of foreign direct Investment (FDI) Statistics, a component of foreign investment statistics.
- To generate investment data needed for monitoring economic development and planning appropriate national policies and;
- To provide additional information useful for investment promotion and trade negotiations.
The survey will be administered to resident enterprises (both local and foreign owned). These enterprises are statistically selected from a pool of enterprises with foreign assets and liabilities.
Confidentiality of data collected is guaranteed under the Statistics Act, 2006 that empowers KNBS to collect Balance of Payments Statistics and other related external statistics. The survey personnel are under oath not divulge any information provided by enterprises to a third party.
Given the importance of this exercise, we appeal to the management of the selected enterprises to cooperate and support the survey field staff. Our field staff have been directed to produce identification badges or introduction letters on demand.
Foreign investment surveys are conducted on an annual basis. The findings of this survey will be disseminated in October, 2018 and will be made available on the KNBS website.