Kenya's economy has displayed resilience in recent months

Plan for muted demand dynamics in Q3 and Q4—but a recovery in 2024

Protests will be directly commercially disruptive for most multinationals. Firms should be prepared for sudden—and potentially protracted—dips in demand over the coming months. However, B2B firms exposed to SME activity will be particularly vulnerable, as will consumer-facing companies selling FMCGs to low-income households, as well as those selling alcohol on-trade. This will necessitate a revision of demand assumptions for 2023, as well as providing support to local partners most vulnerable to the effects of social unrest. 

Looking ahead to 2024, multinationals selling to private sector customers should plan for a gradual improvement in demand conditions as protests subside and the economy gathers pace; however, firms selling to the public sector can expect continued demand weakness and tough pricing negotiations for the foreseeable future.


  • A fresh wave of opposition-led protests in response to rising costs of living has swept Kenya in recent weeks. This follows the government’s enactment of the new 2023 Finance Act on June 21 that raises taxes and slashes subsidies.
  • GDP growth beat expectations in Q1 2023 by accelerating to 5.2% YOY in Q1 2023. Robust credit growth, a rebound in agriculture, and strong service activity helped to counter the effects of disruptive political protests in March, squeezed public finances, and widespread foreign currency shortages.
  • The shilling continues to steadily lose value against the dollar, having reached a new record low every week since February 2022.

Our View

Commercially disruptive protests are likely to continue for several months, because President William Ruto seems determined to clamp down on protesters and push ahead with painful (but necessary) economic reforms that will aggravate cost-of-living pressures. These protests will compound the effects of rising interest rates, government austerity, and muted consumer sentiment, weakening economic performance in 2023. Activity is expected to slow in Q3 and Q4 2023, resulting in annual average GDP growth of 3.7% YOY in 2023, the worst performance since the onset of the COVID-19 pandemic in 2020. 

However, the outlook for 2024 is more upbeat. Dwindling protests and an improved outlook for the tourism industry, driven by improved global economic growth, will aid Kenya’s economy. Additionally, Ruto’s measures to stabilize public finances, such as raising taxes and securing loans from the World Bank in recent months, will make a sovereign default increasingly unlikely in 2024, thereby boosting investor sentiment. After a difficult year in 2023, improved currency stability, FOREX access, and softening inflation will support consumer sentiment in 2024.

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