Home > Insights > The Central Bank of Kenya (CBK) stated that the impact of persistent dry weather conditions on farming will slow down projected growth in 2019.
Tuesday, 23 Apr 2019

The Central Bank of Kenya (CBK) stated that the impact of persistent dry weather conditions on farming will slow down projected growth in 2019.

Insights Africa

Economic Outlook

Economic Outlook

  • The Central Bank of Kenya (CBK) stated that the impact of persistent dry weather conditions on farming will slow down projected growth in 2019 to 5.3% compared to earlier forecast of 6.3% which will cause hard tax collections and slowing growth in new jobs.
  • In Kenya, the value of imports from Uganda declined by more than half in the first two months of 2019, reflecting reduced orders for grains such as maize. Import bill from Kampala amounted to 4.55 BN KES (44.3 MM USD) in January and February 2019 registering a 63.58% drop compared to the same period in 2018.
  • The United Nations has resumed making refunds for Kenya troops in Somalia amounted to 3.75 BN KES (36.98 MM USD) in March 2019, boosting Treasury's cash reserves at the end of Q3-2019.
  • In Kenya, farmers earned 7.8 BN KES (76.9 MM USD) in March 2019 compared to 10.4 BN KES (102.5 MM USD) in March 2018. This decline is due to the high production of Arabica in Brazil, affecting the average price of a 50 kg bag which declined 21% reaching 19,300 KES (around 190 USD).
  • Kenya Breweries Limited (KBL) becomes the second firm to identify betting as a key competitor to the local alcohol business. Kenyans below 35 years are increasingly splitting their disposable income between buying liquor and betting especially Kenyan young men.
  • Economic disruption from uneven currency trading in Nigeria and continued electricity shortages in South Africa are set to hold back overall growth across sub-Saharan Africa in 2019.
  • Despite a challenging economic climate, major global entities in the hospitality industry like Marriott International still see South Africa as a big market with strong investment opportunities, followed by Egypt.
  • First Mutual properties Limited (FMP) announced that the general outlook for Zimbabwe over the long term remains positive with real economic growth estimates ranging between 3.7% and 7% in 2019.
  • The price of bread almost doubled for Zimbabweans last week from 1.80 USD to 3.50 USD due to the Central Bank new monetary policy revealed in February 2019. By introducing a new local currency, prices of goods and services have skyrocketed at rates unseen in a decade.
Political Events

Political Events

  • The U.N. refugee agency (UNHCR) reports 163 refugees from sub-Saharan Africa, who were detained in horrific conditions in Libya, have been flown out of Libya to safety in Niger.
  • The British government has formed a special team to help Kenya trace and recover assets that are proceeds of corruption and hidden in London by tracking every financial dealings of suspected individuals to block corruption networks.
Stock Market

Stock Market

  • African Alliance will exit in May from Uganda's stock market after 15 years. The announcement has raised questions about the South African company's future in African capital markets, as its major shareholder struggles with a slowdown in various financial markets. It is worthy to mention that the total assets accumulated by the unit trust business amounted to less than 4 BN UGX (1.06 MM USD) after six years of operation.
  • SHANTA Gold (an East Africa-focused gold producer, developer and explorer) will be listed on Tanzania Dar es Salaam Stock Exchange (DSE) in an effort to raise 20 MM USD for the development of its Singida Gold Mining project in the East African country.
Companies Transactions

Companies Transactions

  • KCB Group is planning to acquire the entire stake of state-owned National Bank of Kenya with a par value of 5 KES of NBK, deepening the mergers and acquisitions in Kenya banking sector. The offer will occur by a share swap of 10 ordinary shares of NBK for every 1 ordinary share of KCB.
  • Mauritian lender, SBM Holdings, booked a bargain purchase gain amounted to 3.82 BN KES (37.67 MM USD) to carve out certain assets and liabilities from the collapsed Chase Bank Kenya. A bargain purchase occurs when a firm is bought out at a lower value than its fair market value.
  • NIC Ventures, a subsidiary of NIC Group, has launched a mobile-based application where Kenyans can access bid bonds that will provide funding for tenders awarded by government and private entities.
  • Shareholders of NIC Group and CBA Group have approved the merger of the two banks. The merger still needs approval from local and regional regulators, and it is expected to be obtained by June 2019, allowing shares of the merged entity to commence trading on the Nairobi Securities Exchange (NSE) on July 17.
  • National carrier Kenya Airways (KQ) will increase the number of flights on the Kisumu and Mombasa routes during the Easter festivities, as well as operating its Dreamliners, typically used for international long-haul flights, to the Coast region in a bid to cover the high demand.
  • Kenyan Commercial banks pumped more money into government securities in 2018 even as they tightened credit to private enterprises and individuals. Financial statements for 2018 show that 37 banks out of 40 invested 146 BN KES (1.4 BN USD) to reach 1.175 TR KES (1.15 BN USD).
  • Nation Media Group (NMG) shareholders earned 942.7 MM KES (9.2 MM USD) dividend payout after the company declared a dividend of 5 KES in 2018.
  • Chinese online retail giant, Alibaba, has shown support for Rwanda goal of achieving a knowledge-based economy. Alibaba Business School is looking to enroll 30 students from Rwanda by September 2019 to help them transform the country's economy through improved business models and programs.


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