Quarterly Balance of Payments Second Quarter 2017

In the second quarter of 2017, Imports valued on f.o.b increased by 15.5 per cent to KSh 410.9 billion from KSh 355.9 billion in the second quarter of 2016, mainly on account of increased bill on imports of food and petroleum products. On the other hand, exports increased by 2.9 per cent to KSh 150.2 billion in the same period. This resulted into widening of the merchandise trade deficit by 24.2 per cent to KSh 260.8 billion. Receipts from international trade in services expanded by 20.1 per cent to KSh 128.1 billion in the second quarter of 2017 mainly supported by increased travel receipts which grew by 38.0 per cent to KSh 23.5 billion. These developments resulted into 6.4 per cent growth in international trade in services inflows to register a surplus of KSh 38.9 billion in the quarter under review compared to a surplus of KSh 36.5 billion in the corresponding quarter of 2016. In the second quarter of 2017, diaspora remittances remained resilient increasing by 5.1 per cent to KSh 47.6 billion from KSh 45.3 billion in the second quarter of 2016. The surplus in the services account could not offset the deficit in merchandise trade balance leading into an expansion of 18.1 per cent in the current account deficit to KSh 134.8 billion in the quarter under review.

Net financial inflows declined marginally to a surplus of KSh 133.4 billion in the second quarter of 2017 from KSh 134.1 billion in the second quarter of 2016. Gross official reserves increased by KSh 20.8 billion to stand at KSh 889.7 billion as at the end of the second quarter of 2017 compared to an increase of KSh 46.5 billion in the second quarter of 2016.