Economy

CBK, statistics agency differ on key Q2 data

Patrick

CBK Governor Patrick Njoroge. PHOTO | SALATON NJAU | NMG

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Summary

  • CBK estimates the dominant agriculture sector grew 5.8 per cent in the first quarter which is higher than 4.9 per cent the KNBS reported and 6.2 per cent as opposed to 6.4 per cent captured by the statistics office in the second quarter.
  • The Central Bank further estimates the accommodation and food services sector contracted a narrower 64.9 per cent in the second quarter as opposed to 83.3 per cent the KNBS published.

  • Central Bank governor Patrick Njoroge said its estimates on the two key sectors are based on revised figures from the Ministry of Agriculture as of November and feedback from its latest survey on the hotel industry.

The Central Bank of Kenya (CBK) has clashed with Kenya National Bureau of Statistics on the performance of key sectors in the second quarter, resulting in different economic growth projection for 2020.

The CBK estimates the dominant agriculture sector grew 5.8 per cent in the first quarter which is higher than 4.9 per cent the KNBS reported and 6.2 per cent as opposed to 6.4 per cent captured by the statistics office in the second quarter.

The Central Bank further estimates the accommodation and food services sector — which was the hardest-hit by Covid-19 shutdowns and restrictions — contracted a narrower 64.9 per cent in the second quarter as opposed to 83.3 per cent the KNBS published.

Central Bank governor Patrick Njoroge said its estimates on the two key sectors, which have significant weighting in determining economic growth, are based on revised figures from the Ministry of Agriculture as of November and feedback from its latest survey on the hotel industry.

“We have looked more in details in terms of the information that has been given to us, including in the surveys and… this is information that we will obviously be providing to the KNBS,” he said during a post-Monetary Policy Committee (MPC) meeting briefing last Friday.

Dr Njoroge said the Agriculture ministry has, for example, revised projected maize production for this year to 44.9 million bags up from 42.9 million in September and 36.9 million bags initially on account of more favourable weather.

Dr Njoroge, as a result, expects annual economic growth for 2020 to rebound to an estimated 1.3 per cent from 5.7 per cent slump in the second quarter.

That is a downgrade from 3.1 per cent in September, but paints a more optimistic outlook than Treasury secretary Ukur Yatani’s 0.6 per cent which is based on “KNBS’ (economic growth) numbers for Q1 and Q2 which will need to be revised to reflect new information”, he said.

“As a matter of fact, that number (0.6 per cent by the Treasury) is fully consistent with our 1.3 per cent (growth forecast).

“The difference is we are using our base estimate for quarter one, two, three and four,” said the Central Bank boss.