Kenya Plans to Rebase Economy, Reconstitute Inflation Basket

NAIROBI (Capital Markets in Africa) – Kenya’s statistics agency plans to revise the size of the East African economy and reconstitute its inflation basket after a survey of household incomes showed poverty levels fell in the past decade.

It’ll be the second rebasing of statistics used in calculating gross domestic product since 2014, when the nation increased the size of its economy by a quarter to $55.2 billion. Annual output is now estimated at about $70.5 billion. A higher GDP figure will help to lower Kenya’s debt ratios and improve its ability to borrow.

The 2015-16 survey by the Kenya National Bureau of Statistics showed poverty levels declined to 36 percent of the population from 46.6 percent in 2005-06, Director General Zachary Mwangi said in the capital, Nairobi. People classified as poor are those earning less than 3,262 shillings ($32) per month in rural areas and 5,995 shillings in urban regions, the study on nearly 22,000 households showed.

While Kenyans spend 54.3 percent of their income on nutrition, only 36 percent of the inflation basket covers food. The agency said just 7.4 percent of Kenyans are unemployed, a decline from 12.7 percent when its last household survey was carried out.

Source: Bloomberg Business News