Improved rainfall promises better outturn for economy

The agricultural sector offers employment to a significant number of Kenyans, making higher earnings from the farms critical to the reversal of the sagging demand for goods and services.

Agriculture accounts for 20 per cent of the country’s wealth or the gross domestic product (GDP), having dropped from a high of 24 per cent in 2007.

Increased supply of food also culminates in lower inflation since food takes up the largest share of most poor households’ monthly expenditure and a drop in the price of food leaves consumers with higher disposable incomes to spend on other goods such as airtime, clothing and beer.

Agriculture is closely linked with Kenyan’s industrial sector where agro-based manufacturers account for 40 per cent of the country’s entire manufacturing sector.

A poor crop hurts the manufacturing sector in the form of high input costs that blunts industrialist’s competitive edge as well as delivers lower profit margins, which are behind the growing unemployment.