Kenya’s horticulture and tourism sector falls widening account deficit to 6.2 percent in the year to March from 5.8 percent in December 2019, highlighting the less exports of goods due to the coronavirus pandemic.
The regulations imposed in the air travel had significant effects on the horticulture and tourism sectors, which has seen disrupt the country’s forex inflows and outflows.
Central Bank of Kenya (CBK) expects by the end of 2020, the current deficit will be at 5.8 percent.
“Horticulture exports, receipts from transport and tourism services, are expected to decline. A significant decline in horticulture exports, particularly flowers, was noted, from March to mid-April 2020. This mainly due to reduced demand Kenya’s key export market destination,” said CBK in a Covid-19 presentation to the senate.
Petroleum import costs are now expected to boost the economy as the international crude prices face a fall due to the low demand amid other Covid-19 effects.
“The imports of petroleum products are expected to decline by $1.1 billion (32 percent) due to low international oil prices, offsetting the decline in export earnings and remittances,” said CBK.
According to the latest data from CBK, trade in the first two months of the year showed a fall in the horticulture exports, although tea and coffee recorded an increase in earnings.