East Africa Economic Report

Geothermal is now the lead electricity Source in Kenya   You may say $101 billion according to recent estimates by Bretton woods institutions and Africa Development Bank. You won’t be wrong. You could also be wrong. These institutions calculate their estimates based on the country’s recorded GDP figures. And those figures depend on the base year which could be.. well, outdated. Here’s why: There is an animal Economists- and I believe Statisticians too- call rebasing the accounting base year which captures the true size of the economy.    Rebasing is updating the base year to a new year so that the accounting of GDP is updated. Rebasing, therefore, means selecting a new base year.   You see, the economy is not static. It is dynamic. It therefore grows and expands over a period of time. The expansion includes new economic activities that were initially insignificant, but have become significant contributors. It also includes new developments that did not exist prev...

The Southern Bypass in Nairobi.  Completed in 2015 Kenyan anti-debt warriors rattled the IMF last week with their protest over a US$2.35 billion loan to the  country. The three-year program, to be released in tranches, will cushion the country as it grapples with the crisis induced by COVID-19. These include reduction of debt vulnerabilities, that is, to ensure Kenya does not default on previous loans among others. The pandemic and its effects are a global reality and containment measures resulted in a self-inflicted economic pain, not just in Kenya, but globally. Some sectors such as air travel ground to a halt, the hospitality and entertainment industry simply collapsed, while others cut down operations. All measures resulted in a huge threat to employment with retrenchments and furloughs. Air travel may never recover to its pre-pandemic levels due to the growing adoption of digital conferencing. In effect, the economic downturn is no fault of our own. Tax revenues dec...