World Bank cuts Kenya 2012 GDP growth forecast, sees 2013 rebound -
http://reut.rs/Vlm2rj
Quote:The World Bank said on Wednesday it had cut Kenya's economic growth forecast to 4.3 percent in 2012 from an earlier 5 percent due to the effects of high lending rates, before recovering to 5 percent in 2013.
Growth slowed sharply in the first half to 3.5 percent, as key sectors like construction sagged under the weight of high commercial lending rates that topped 25 percent after policymakers raised the central bank's rate to 18 percent to fight inflation.
The 5 percent growth prediction for 2013 will depend on a presidential election scheduled for March 4 conducted peacefully, the World Bank said.
At least they've cut their ridiculous lofty GDP growth expectations. Now waiting for treasury's downward review as they swallow humble pies. KE GDP 2012 at 5.1% my foot! With those NSE firms already issuing profit warnings and KRA behind targets, who will push GDP to 5.1%? in 2012? Houdini math by FinMin...
Next year is also tricky to achieve 5% that WB suggests since Q1 2013 will be on the backfoot due to the election lull. If a run off occurs the lull is extended by another month. Then we head for June budget. By the time that stimulus (if they treasury decides to stimulate - I expect them to do so) this will be hitting the econ in late Q2 2013 - early Q3 2013. That will be another year done with GDP sub 5%. So realistically 2014 is when things will start shaping up where we can expect GDP to hit 5% - 6% backed by the 2013 recovery momentum assuming elections don't throw a spanner in the works.
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!