NAIROBI, July 29 (Xinhua) — Kenya’s economy is projected to expand by 4.6 percent in 2026 before picking up slightly to 4.7 percent in 2027, the African Development Bank (AfDB) said in a new report released on Tuesday.
The lender said that while the East African nation grew by an estimated 5 percent in 2025, the anticipated slowdown this year stems from heightened global uncertainty and rising fuel costs.
Kenya’s projected growth trails the East African regional averages of 5.9 percent in 2026 and 6.4 percent in 2027, and the gap is largely driven by exceptionally strong performances in several faster-growing neighboring economies, the AfDB said in its Country Focus Report (CFR) 2026.
The AfDB expects Kenya’s inflation to tick up to 5.4 percent in 2026, remaining well within the Central Bank of Kenya’s target range of 2.5 to 7.5 percent.
In the short term, key threats such as adverse weather events, elevated global interest rates, commodity price volatility, exchange-rate pressures and heightened geopolitical tensions could weaken growth prospects, worsen fiscal and external balances, and inflate financing costs, it added.
According to the AfDB, there is also political uncertainty ahead of the 2027 elections, which may affect investor sentiment and the pace of reform implementation.
Published annually, the CFR assesses African countries’ recent economic developments, highlighting macroeconomic performance and outlook.
