With a population of approximately 52 million, Kenya is a nation in East Africa. Recently, the Kenyan economy has advanced significantly, especially in terms of development and expansion. For the nation to continue on its rising trajectory, there are still a few issues that need to be resolved.

We shall give a thorough analysis of the Kenyan economy's present situation in this post. We will discuss the nation's economic development and growth, its problems, and the government's initiatives to solve them. We will also go through the possibilities open to firms and investors wishing to enter the Kenyan market.

Economic Development and Growth

The Kenyan economy has expanded gradually in recent years, and in 2019 it expanded at a rate of about 5.4%. The services sector, which makes up over 60% of the nation's GDP, was primarily responsible for this development. Agriculture, manufacturing, and tourism are additional industries that have a large impact on the economy.

Agriculture

Around 75% of Kenya's workforce is employed in agriculture, making it a vital part of the nation's economy. The industry is a key contributor to economic growth, accounting up about 25% of the nation's GDP. Kenya's primary agricultural products include sugarcane, tea, coffee, horticulture, maize, and wheat.


Kenya is one of the world's leading producers of tea and coffee, and these crops are key exports for the country. Kenya exported 499,000 metric tons of tea and 37,000 metric tons of coffee in 2019. Horticulture is also a key export, with Kenya being the top fresh produce exporter to the European Union.


Despite its importance, the agricultural sector continues to face severe challenges. Climate change, soil deterioration, and pests and illnesses are among them. Several programs have been established by the government to address these concerns, including the National Climate Change Action Plan, which aims to encourage sustainable land use practices and boost agricultural output.


Manufacturing

Manufacturing is another key sector of the Kenyan economy, accounting for approximately 10% of GDP. The sector is mostly concerned with agriculture, textiles, and construction materials.
The Kenyan government has implemented a number of programs aimed at promoting the expansion of the manufacturing sector, such as the creation of special economic zones and the application of investor incentives. In order to create jobs and increase local production, the government has also established initiatives to promote local content in manufacturing.

Tourism

Tourism contributes significantly to the Kenyan economy, contributing for around 10% of the country's GDP. Kenya is a popular location for wildlife safaris, beach vacations, and cultural tourism, hence the sector is a key source of foreign cash.
The tourism industry has encountered various hurdles in recent years, including security issues and the COVID-19 epidemic. The government, on the other hand, has initiated steps aimed at developing the industry, such as the adoption of security measures and the formation of the Tourism Promotion Fund.

The Economic Challenges Facing Kenya

Despite recent progress, the Kenyan economy still confronts a number of obstacles. These are some examples:

Unemployment

Unemployment is one of the most serious problems confronting the Kenyan economy. Despite economic progress, the unemployment rate remains high, especially among young people. According to the World Bank, Kenya's young unemployment rate in 2020 will be around 22%.
The Kenyan government has implemented a number of efforts to combat unemployment, particularly among young people. The Youth Employment and Empowerment Program, for example, provides training and career opportunities for young people.

Corruption

For many years, corruption has been a major issue in Kenya, with many government officials and entrepreneurs being charged.