NAIROBI, June 30 (Xinhua) -- Kenya's economy grew by 5.9 percent in the first quarter of 2016 compared to 5.0 percent during the same period in 2015, the Kenyan statistics bureau said on Thursday.
The growth is buoyed by a rebound in the hospitality sector, according to the Kenya National Bureau of Statistics (KNBS).
The KNBS data shows the most notable improvement was seen in activities of accommodation and food services expanded by 12.1 percent in the period under review compared to a contraction of 11.4 percent during the same quarter in 2015.
In addition, agriculture, transport and mining also recorded improved growths during the quarter as manufacturing, construction and finance posted slowed growth.
"Construction and finance and insurance registered slowed but robust growths in the quarter. However, growth of the manufacturing sector remained depressed over the same period," the bureau said.
The agricultural sector showed marked improvement mainly buoyed by considerable growth in value added of key crops such as tea and horticultural crops.
The bureau said tea production recovered from a contraction of 27.2 per cent experienced in the first quarter of 2015 to a substantial growth of 71.1 percent owing to favourable weather conditions that characterized the quarter in review.
The transport sub-sector benefited significantly from the declining international oil prices that continued into the first quarter of 2016.
During this period, the sector grew by 8.4 per cent compared to a 6.7 per cent growth in the first quarter of 2015. The accelerated growth was mainly driven by the considerable drop in the average price of light diesel.
The hospitality sector, which mainly comprises of activity of hotels and restaurants, posted a growth of 12.1 per cent in the quarter under review after a two year spell of poor performance largely occasioned by security concerns and economic downturn in some key tourist markets.
"This recovery is evidenced by a significant rise in the number of tourist arrivals at major airports from 231,038 in the first quarter of 2015 to 261,404 in the quarter under review," it said.
According to KNBS, inflation rose to average at 7.0 per cent during the quarter under review, compared to 5.8 per cent in the first quarter of 2015.
Weighted average commercial banks loans and advances rates also edged upwards to average at 18.4 per cent during the quarter compared to 15.6 per cent in the first quarter of 2015.
The current account balance improved by 30.1 per cent from a deficit of 1.01 million U.S. dollars in the first quarter of 2015 to a deficit of 710,018 dollars in the quarter under review.
This was primarily due to a slowed decline in the value of imports coupled with a significant growth in the value of exports. The sustained fall in the international oil prices continued to support the improvement of the country's current account balance.
