Market News
Manufacturing goods recorded the fastest growth among Kenya’s major exports in the 10 months to October, signalling the return to health for the sector, which was badly affected by the curfew restrictions and low demand during the peak of the Covid pandemic.
Data from the Central Bank of Kenya (CBK) shows that these exports rose by 35 percent in the period to hit Sh46.97 billion, outpacing on relative terms the growth in raw materials and horticulture exports which went up by 24.6 percent and 23.8 percent to Sh41.1 billion and Sh108.8 billion respectively.
The manufacturing sector has recorded an improvement in both sales turnover and demand for credit, indicating that firms are fielding more orders and producing at a higher capacity compared to last year.
Their productivity was hurt last year on reduced demand for goods as consumers exercised caution in spending due to pandemic-fuelled uncertainty.
The bulk of Kenya’s manufactured goods exports are made to neighbouring countries with Uganda the biggest destination of Kenya’s exports.
“We have seen a strong rebound in some components of exports. With tea, volumes are high and prices have come down, while coffee global prices are high because of weather problems in Brazil,” said CBK governor Patrick Njoroge last week.
Coffee exports rose by 15.1 percent in the period to hit Sh24.1 billion, while those of tea fell by 6.3 percent to Sh109.4 billion.
The price of tea has shown signs of recovery though after touching a five year high at last week’s sale at the Mombasa auction due to improved demand.
The rise in exports has, however, not helped narrow the balance of trade with imports rising at a faster pace.
The CBK said the country’s import bill rose by 23.6 percent in the 10 months, driven by increases in imports of oil and other intermediate goods.
Consumer and capital goods imports also went up, reflecting the realisation of pent up demand as the economy continues to recover its footing.
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Source: Business Daily Africa
