Kenya’s economic landscape continues to show resilience as the country’s total exports reached Ksh 1.05 trillion ($8.14 billion) in the 12 months leading up to October 2024, reflecting an 11.9% growth from the same period the previous year. This growth is largely attributed to a sharp rise in re-exports, which surged by 78%, from Ksh 92.9 billion in 2023 to Ksh 165.5 billion this year. The Central Bank of Kenya (CBK) reports that these numbers underscore a broader trend of economic resilience amidst global uncertainties.
Agricultural Commodities Lead the Charge
The substantial increase in exports was buoyed by strong performances in key sectors such as agriculture, which saw a 15% growth in export earnings from January to October 2024, reaching Ksh 902.7 billion compared to Ksh 785 billion over the same period in 2023. This growth was largely driven by robust export activities in fresh vegetables, which recorded the highest growth rate 29.4% with earnings reaching Ksh 35 billion from Ksh 27 billion the previous year. This trend highlights the vital role of the agricultural sector in Kenya’s export performance, contributing significantly to the economy’s overall resilience.
Dr. Kamau Thugge, the Chief Economist at CBK, emphasized that the export growth was not only due to traditional sectors like agriculture but also reflected a diversification of the export base. He noted that this year’s performance was significantly better compared to 2023, largely driven by a recovery in domestic export volumes, which grew by 4.7% to Ksh 877.6 billion from Ksh 838.5 billion in 2023. The recovery was seen across various commodity groups, including mineral fuels, animal and vegetable oils, and miscellaneous manufactured articles, with increases of 37.3%, 33.8%, 31.6%, and 18.3% respectively.
Re-Exports and Miscellaneous Growth
A sharp increase in re-exports, which now contribute significantly to the export basket, also played a crucial role. The 78% rise in re-exports is attributed to a boost in trade with regional and global markets, reflecting Kenya’s role as a strategic hub for re-export activities. These activities involve the redistribution of goods, especially from Asia and the Middle East, to East Africa and beyond. The resilience in global trade patterns, despite disruptions in global supply chains, has been favorable for Kenya’s re-export sector, underscoring the country’s position as a key player in the regional trade network.
The growth in domestic exports was equally significant, driven by the increase in exports of clothing and accessories, which saw a 19.7% rise to Ksh 51.5 billion from Ksh 43 billion in 2023. This growth in non-traditional exports highlights Kenya’s efforts to diversify its export base beyond the traditional markets of Europe and the Americas, leveraging emerging markets in Africa, particularly within the East African Community (EAC).
Outlook and Future Prospects
Looking forward, the CBK remains optimistic about the prospects for export growth, projecting an 11.6% increase in exports for 2024 compared to 2023. The growth is expected to be sustained by a combination of factors including improved agricultural yields, enhanced trade facilitation measures, and an anticipated recovery in global demand for key Kenyan exports. The CBK’s projections also point to a stable exchange rate, which will help support the current account deficit expected to remain at 4% of GDP between 2024 and 2025.
This positive outlook for Kenya’s exports is further supported by initiatives aimed at boosting trade, such as the continued push for deeper integration within the EAC, enhancing regional trade protocols, and promoting cross-border trade with neighboring countries. These efforts are expected to reduce trade barriers and expand market access for Kenyan goods, particularly in agricultural products.
In conclusion, Kenya’s impressive export performance in 2024 underscores the country’s resilience and adaptability in the face of global economic challenges. The growth in exports is not only a reflection of improved agricultural productivity and strategic trade policies but also a testament to Kenya’s evolving role as a key player in the regional and global trade landscape. As the country continues to diversify its export base and explore new markets, it remains well-positioned to sustain its economic growth and achieve its development goals.
