East Africa’s economic powerhouse Kenya is expected to see economic growth and improved foreign direct inflows, a leading analyst has predicted.
“We are expecting increased business in the country and region due to improved business confidence and growth potential in the east African and sub-Saharan region,” Eric Munywoki, Research Analyst at Old Mutual Securities told CNBC Africa.
“We expect this to translate into improved inflows into the country,” he added.
East Africa has also been working on intergration of the economies that might see the region becoming the first in Africa to do away with borders. This, according to analysts, will see the regional countries realising economic growth.
Commenting on Kenya’s Road Annuity Fund that seeks to finance development of the East African nation’s road network, Munywoki said the move would help deliver efficiency.
“What we have been used to is the tendering process, the direction the government is taking is likely to deliver more efficient results,” he said.
“I am expecting to see reduced debt to GDP ratio as the government is trying to move away from excessive borrowing.”
According to reports, Kenya plans to raise as much as 13.1 billion US dollars over the next decade.
“This process will increase efficiency in road maintenance and construction,” said Munywoki.
“They are looking at getting these funds from private investors which means payment will be done at a later date at a given premium.”
Kenya’s presidency said the country will build 10,000 kilometers of new roads with 20 per cent of them being highways. This initiative is set to be realised within five years to help promote national integration and improve security.
Munywoki weighed in on reports warning of impending food imports due to droughts that will be caused by global warming.
“We are still using ageing technology in agriculture. There has been a lax approach in how we conduct our agriculture,” he said.