Kenya’s sound macroeconomic management and economic resilience built over the years has enabled the country to maintain strong economic growth and stability.
The Director General of Budget, Fiscal and Economic Affairs in the National Treasury Dr. Geoffrey Mwau, said Kenya’s economic growth prospects continues to remain stable due to the strong foundation of economic transformation.

 “In 2014, the economy grew by 5.3 percent and is estimated to expand by 6.5 to 7.0 percent in 2015, rising further to 7.0 percent over the medium term”, Dr. Mwau said.
The Director General of Budget, Fiscal and Economic Affairs was speaking at Kenyatta International Convention Centre (KICC) Nairobi after making a presentation to the Budget Sector Working groups on the state of the economy and the macroeconomic outlook for financial year 2016/17 and the medium-term.
“The various priority economic policies, structural reforms and Sectoral expenditure programmes outlined in the 2015 Budget Policy Statement will address challenges to economic outlook, bolster resilience to shocks and foster sustained high and inclusive growth as part of the strategy of enhancing economic transformation for a shared prosperity”, Dr. Mwau added.
He said the country’s growth prospects is favourable and is expected to be boosted by fairly good amount of rainfall and implementation of strategic interventions to revamp agriculture and energy sectors, adding that the completion of  infrastructure projects such as Standard Gauge Railway, roads and energy generation will create employment and reduce poverty.
“Stable macroeconomic environment characterized by low inflation, and stable interest rates and exchange rate will improve the country’s competitiveness and boost investments”, said Dr. Mwau.
Further structural reforms on improving competitiveness of the private sector and promoting overall productivity in the economy, he said, will be undertaken, adding that exports will continue to benefit from the initiative to deepen regional integration and promote Kenya’s exports globally.
“The agenda focuses on locking in a solid, sustained and balanced growth that opens economic opportunity and provides a better future for all Kenyans”, the Director General said.
On monetary policy, Dr. Mwau said the country will strive to maintain a stable inflation of around 5 percent interest rates and exchange rates and strengthen the international reserves position to over 4.5 months of import cover.
He said fiscal policy will support rapid economic growth and ensure the debt position remains sustainable while at the same time supporting the devolved system of government.
“The focus of Government is and will be on programmes that will end poverty through job creation, entrenching human lives, engendering human potential and security prosperity for all Kenyans”, the Director General said.
Dr. Mwau however pointed out the challenges in the macroeconomic environment such as public expenditure pressure, especially recurrent expenditure which continue to pose a fiscal risk to the economy.
Wage pressure and the inefficiencies in the devolved services, he said, may limit continued flow of funding for development expenditure.
“The impact of insecurity on tourism, and depressed rainfall which could affect exports and agricultural production, continued weak growth in advanced economies that will impact negatively on our exports and tourism activities, and geopolitical uncertainty on the international oil market will slow down the manufacturing sector”, added Dr. Mwau.
Dr. Mwau said the government has negotiated a stand-by arrangement and stand-by credit facility (SBA/SCF) of US$688.3 million to mitigate against exogenous shocks which might affect public investments.
He further said the government will continue to construct dams for irrigation, to enhance food security and to modernize security systems in a bid to eradicate insecurity and to attract investments and tourists to the country.