Corporate News
Drought shock adds new twist to Kenya’s economic outlook
Masinga Dam: Low rainfall means that Kenya’s ability to generate electricity from the less expensive hydro sources will diminish. Photo/FILE
Posted Thursday, September 9 2010 at 00:00
But the impact of rising food prices on the official inflation was muted by the significant fall in mobile phone tariffs, which halved because of a price war in the mobile telephony market.
Inflation dropped to 3.2 per cent in August down from 3.6 per cent in July.
Reduced water supply is also poised to hurt the performance of the state owned water companies — which has hoped increased supply will boost their revenues after the government increased water prices early in the year.
It means that the water providers will find it difficult to recover their full operation costs in the medium term and leave a surplus to allow them improve infrastructure.
Performance of the water companies is a national eyesore and according to the water ministry out of the 120 companies formed in 2002 as part of the reforms, only 22 meet their expenditure.
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