[kictanet] WORLD BANK FORECAST

[Lucy Kimani]

KEY FINDINGS


Kenya may now be at a tipping point for robust growth. Five factors are creating a positive momentum: the new constitution, EAC integration, ICT innovations, strong macroeconomic management, and recent investments in infrastructure. 
For 2010, the World Bank is revising its growth forecast upwards to 4.9 percent.  For the first time in 3 years Kenya will experience balanced growth across all sectors and quarters of the year. 
For 2011, we project GDP growth at 5.3 percent, and even 6.0 percent if no shocks occur. Public sector investments in infrastructure will stimulate growth.  Timely implementation of constitutional reforms would also bolster business confidence.  
Kenya has experienced a telecommunications revolution in the last decade. Without the robust growth in ICT, growth in GDP per capita would have stagnated.
The explosive growth in ICT happened because the government liberalized the telecoms sector, allowing competition. This is a very useful lesson for other sectors.  
Mobile moneyhas become a game-changer for the economy. For example, nearly 70 percent of all adult Kenyans have access to financial services, compared to less than 5 percent in 2006.  Fifteen million Kenyans are expected to transfer US$7 billion (20 percent of GDP) via mobile money in 2010. 
One of the reasons mobile money is so successful is that regulation followed innovation.  An optimal regulatory regime should have rules tight enough to protect users and to discourage fraud, but loose and open enough to encourage innovation and the development of new services. 
Kenya could become a global hub for IT innovations and IT-enabled services. Recent innovations―in crisis monitoring, in healthcare services, in public awareness campaigns, in commodity prices, in mobile money, etc.―and investments in fiber-optic cables, the proposed ICT city, and a well-educated and urbanized labor force provide the basis for developing Kenya into a global ICT hub. 


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Full Report
Executive Summary
Key Findings
Annexes
The ICT Revolution and Mobile Money
State of the Kenya's Economy
RESOURCES


KEU Powerpoint Presentation
KEU: June 2010
KEU: December 2009
Discuss this report



contacts

Wolfgang Fengler
Lead Economist
Tel.: (254-20) 322-6408
E-mail: wfengler at wb.org

Peter Warutere
Communications Officer
Tel.: (254-20) 322-6444
E-mail: pwarutere at wb.org
multimedia

Kenya: At a Tipping Point for Robust Growth
Kenya has recovered from the triple food, fuel, and financial crises and is experiencing significant growth fuelled by a new constitution, the telecommunications boom, macroeconomic management and regional integration among other factors. 

Kenya's Economy Expected to Grow Between 5.3-6 percent
CNBC Interview with World Bank Lead Economist for Kenya Wolfgang Fengler 
More Multimedia





 
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