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  • 25 Oct, 2025
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Economy

Kenya's economic policies and initiatives

Kenya's economic policies and initiatives

Kenya’s 2025 economic agenda focuses on tech-driven growth, digital infrastructure, climate-smart agriculture, and fiscal reform to attract investment, cut deficits, create jobs, and establish itself as Africa’s innovation hub. Key tactics include AI policy, green energy, and tax reforms.

An export competitiveness report on key sectors

Kenya’s export potential lies in agriculture, tourism, manufacturing, and tech sectors. With strong growth forecasts and government support, the country can boost foreign exchange through value addition, sustainable practices, and improved infrastructure and investment climate.

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Kenya’s debt management and potential economic risks

Kenya’s public debt reached Ksh 10.6T (70% of GDP) by June 2024. Despite high debt distress risk, fiscal reforms aim to cut deficits. Economic growth is forecast at 5.3% in 2025, driven by agriculture and services. Risks include inflation, investor flight, and limited fiscal space. Debt strategy focuses on domestic borrowing, risk reduction, and transparency.

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Kenya’s Trade Volumes under AfCTA & Expected Policy Shifts

Kenya's AfCFTA strategy aims to boost industrialization through value-added exports in textiles, pharmaceuticals, and more. Exports to Africa rose over 20% in 2023–24. Policy shifts in 2025 will enhance trade facilitation, diversify revenue, and support SMEs, positioning Kenya for deeper regional integration and competitiveness.

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Economic measures and policies

Kenya's economic policies focus on climate action, fiscal reform, and social support. Measures include tax cuts, subsidies, monetary easing, investment in green energy and infrastructure, and support for SMEs and vulnerable groups. The goal is sustainable growth, inflation control, and resilience to global economic shocks.

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Kenya’s macroeconomic trends

Kenya faces fiscal pressure with public debt at Ksh 10.6 trillion (70% of GDP) and a 2024/25 budget deficit projected at 3.3% of GDP. The government aims to boost revenue via digital taxation and integrating the informal sector. The service sector, contributing 55% of GDP, is vital but tax collection lags, increasing reliance on borrowing.

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