Transportation
Latest economic data shows that contribution of transportation business to Kenya's GDP was found to be higher by 2.8 points at 10.8 per cent.

Roads, railways and bridges have made transport the new major contributor of economic growth as agriculture paves the way as the engine of one third of Kenya’s GDP.

A revision of the Kenyan economy data shows agriculture may not be the backbone of the economy for very long after its contribution to total GDP shed 12.5 percentage points from a 5-year average of 32.9 per cent in the old series to 20.4 per cent in the new order.

On the other hand, the contribution of transportation business in the new series was found to be higher by 2.8 points to 10.8 per cent.

Kenya rebased its economy for 2019 which essentially increased the size of the economy to Kes10.2 trillion up from Kes9.7 trillion.

The 5 per cent jump is lower that when Kenya last rebased its economy in 2014 which saw GDP rise by 25.4 per cent to Kes4.3 trillion from Kes3.6 trillion.

This is the seventh time Kenya’s economy will be undergoing the exercise, with previous ones in 1957, 1967, 1976, 1985, 2005, and 2014.

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For a long time, economists have qualified agriculture as the backbone of the country’s economy, a sector that been solely reliant on erratic weather patterns to support Kenya’s economy.

However, over the years commodity prices have remained tame while production has near stagnated prompting more farmers to abandon agriculture and turn their farms into real estate investments.

The young generation have also shunned agriculture in favour of blue collar jobs in the service sector.

Recent shifts have seen services, construction and transport industries grow significantly to account for a bigger share of the GDP especially since price of new pockets of growth have risen faster than commodity prices.

Economic shocks such as the Covid-19 pandemic, however, disrupted the service sector more than agriculture which calls for rethinking of this quickly evolving model.

Agriculture growth increased from 3.0 per cent recorded in 2019 to 5.4 per cent in 2020, as manufacturing contracted by 0.1 per cent in 2020 compared to 2.5 per cent, electricity contracted by 0.5 per cent while transport shed 7.8 per cent compared to 6.3 per cent growth in 2019.

Information and Communication sector’s growth also slowed to 4.8 per cent in 2020 compared to 7.5 per cent growth in 2019 while contracted by 47.7 per cent in 2020 compared to 14.3 per cent growth in 2019.

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