Kenya’s imports from China—the country’s leading source of goods—grew 11.58 percent to Sh546.3 billion in the six months to June, marking a rebound from a rare slowdown during last year when inflation muted consumption.
Kenya imported goods worth Sh489.6 billion from the Asian country in the first half of 2023—meaning that shipments grew by Sh56.7billion compared to a similar widow of 2023, according to data by the General Administration of Customs of the People’s Republic of China.
The data does not indicate the actual quantity of goods Kenya imported from China, but the increase in value signals an rise in import quantities. China is by far the largest exporter of goods to Kenya and is a major source of electronics, clothes, beauty products, steel, furniture, equipment, and machinery.
The increase in imports from Kenya’s main source markets signals increased local demand amid a strong rally by the Kenyan shilling against the US dollar in recent months.
Further, inflation has eased in recent months to reach a low of 4.6 percent in June driven by a decline in the prices of electricity, food, and fuel which is likely to stimulate consumption in the short-term.
Kenya’s imports from China posted a rare drop in 2023, dipping to $ 7.87 billion (Sh1.03 trillion) from $ 7.97 billion (1.04 trillion) in 2022. After China, the United Arab Emirates (UAE), India, Saudi Arabia, and Malaysia closed the list of the five leading sources of goods to Kenya respectively, according to data from the Kenya National Bureau of Statistics (KNBS).
Kenya imports mainly petroleum products from the UAE and Saudi Arabia, pharmaceuticals from India, and cooking oil from Malaysia. Slow economic growth hampered imports last year as high inflation and increased taxation reduced demand for goods and services, tempering economic growth.
According to KNBS data, the value of imports increased marginally in 2023 to Sh2.5 trillion up from Sh2.4 trillion in the previous year. During the period, import volumes for food commodities rose significantly except maize.
“The increase was largely driven by high demand for food commodities in the country to alleviate hunger, following a prolonged drought in the first half of 2023 that affected domestic production,” said KNBS.
However, imports of non-food commodities exhibited mixed performance, with volumes of key industrial products such as cement, steel, and petroleum products all declining, while quantities of fertilisers, cooking gas, second-hand clothes, and chemicals increased.
The Stanbic Bank’s Purchasing Managers’ Index (PMI) for June shows that business activity fell sharply during the month amid reports of widespread economic challenges and a negative impact on sales from protests and policy uncertainty.
“New business intakes dropped at the fastest rate since November last year, leading to a drop in business confidence and weaker job creation,” it said.
Business expectations towards future activity, said the report, slipped to a four-month low, as economic challenges led firms to show less optimism towards their sales and output forecasts.
