Kenya’s economy remains the largest and most diversified in eastern Africa with a Kshs2.9 trillion ($34.2 billion) Gross Domestic Product (GDP). Its financial system and capital markets are not only strong, but also very vibrant.
The 2011/ 2012 budget rose to cross the trillion threshold at Kshs1.115 trillion ($13.2 billion) from Kshs998.8 billion ($11.8) the previous year. The 2009/2010 Budget was Kshs887 billion ($10.4 billion), meaning this has gone up 26 per cent in dollar terms inside three years. In the past eight years, revenue collection has more than tripled, giving the country the much- needed independence to implement projects without external interference.
The Nairobi Securities Exchange is a vibrant bourse patronised by both local and international investors and -like Johannesburg, Lagos and Cairo securities exchanges – it is an important destination for international portfolio investors. The market capitalisation as at December 2011 stood at Kshs868 billion ($10.2 billion) from Kshs1.2 trillion ($14.2 billion) the previous year, and the NSE 20 share Index slid 27.7 per cent to 3,205 points from 4,432 points. In 2007, the index hit a peak of 6,000 points.
The bond market has become a regional case-study and a key source of funds for Government, State corporations and the private sector. The longest maturity-tenor bond now is 30 years.
Banking, insurance and forex sectors are vibrant, enjoying one of the most stable periods in history: there are 43 banks – local and international, 42 insurance companies, 2,665 insurance agents, 201 insurance brokers, 44 underwriters, two re-insurance companies and 126 forex bureaus.
And the pension sector, too, is solid and well regulated: There are 17 private scheme fLmd managers managing 1,192 schemes in 2010 and the National Social Security Fund (N SSF).
The sector, regulated by the Retirement Benefits Authority (RBA), boasts of an asset base in excess of Sh470 billion.
The mobile phone telephony sector has grown by leaps and bounds. Kenya has four mobile phone companies – Safaricom, Airtel, Telkom and Yu with about 28 million subscribers. The country was the first to commercially use mobile phone money transfer in the world, which now has nearly 16 million subscribers. Safaricom’s M-Pesa was the most widely used in 2010 with 305.7 million transactions effected, valued at Sh727.8 billion in the year.
Kenya’s economy has weathered political and economic crises since 2008 and last year recorded growth of 4.4 per cent, down from 5.6 per cent in 2009.