Kenya must execute its plan to vaccinate the entire adult population against the COVID-19 pandemic by mid-2022.
In its latest Kenya Economic Update Report, the World Bank warns that a sluggish deployment of vaccines due to various reasons such as supply and logistical hurdles could weaken Kenya’s economic recovery.
According to Keith Hansen, World Bank Country Director, Kenya’s economic outlook remains bleak due to the pandemic.
He added that while Kenya’s economic outlook remains hazy due to the pandemic, a plan by the state to vaccinate the entire adult population by the middle of next year could boost recovery in many sectors, albeit unevenly.
The East African nation’s GDP is forecast to grow by 4.5 per cent in 2021, from an earlier projection of 6.9% given in November last year by the WB.
This signals a partial recovery from the COVID-19 (coronavirus) pandemic, which caused growth to stall last year.
This 23rd edition of the Kenya Economic Update titled RISING ABOVE THE WAVES says Kenya’s economic recovery hinges on the success of the vaccination effort.
A weekly bulletin by Genghis Capital says the World Bank expects the country’s growth in the next two years to average over 5.0%.
This growth will be bolstered by an upturn in industry supported by reopening of the economy and strong capital spending, moderate recovery in services as vaccination rollout progresses and adequate agricultural harvests and sales.
Private consumption is expected to continue its recovery on the demand side, as wages and incomes of households, as well as resilient diaspora remittances, pick up.
The World Bank recently announced additional financing for COVID-19 vaccination in the order of US$130Million.
Analysts at Genghis say this funding is expected to pay for vaccine doses for 6.13Million persons (12.5% of the population) through COVID-19 Vaccines Global Access (COVAX) and/or African Vaccine Acquisition Task Team (AVATT).
Private consumption is expected to strengthen, supported by a recovery in wages and household incomes and substantial remittances.
The WB says vaccination should enable the return of mobility to pre-pandemic levels, boosting consumer confidence and business activity levels.
External factors such as a slow global economy and new infections could also hit Kenya’s recovery in tourism, capital flows and goods exports.
According to Alex Sienaert, Senior Economist for at the World Bank, the country’s economic recovery efforts due to the fluid pandemic situation.