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Kenya’s economy expanded at a slower pace of 4.9 percent in the first quarter as tourism shrunk following a spate of attacks in the East African nation.
Growth slowed from a revised 5.5 percent in the final three months of last year, the statistics office said in an e-mailed statement on Wednesday. The tourism industry contracted for a fifth consecutive quarter, declining 7.5 percent from a year earlier, it said.
“The continuous underperformance of the sector is due to insecurity concerns, especially at the coastal region, and negative travel advisories in some key European source markets for the country,” the Kenya National Bureau of Statistics said. The bed occupancy rate at coastal beach hotels fell by an estimated 21.9 percent in the first quarter, it said.
Kenya’s shilling has dropped 8.7 percent against the dollar this year as tourism declined and tea production fell, reducing revenue from the nation’s biggest foreign-exchange sources. The currency was unchanged at 99.25 per dollar as of 4:40 p.m. in Nairobi, the capital.
The farming industry, which accounts for nearly a third of the $55 billion economy, grew at a faster pace of 4.4 percent in the first quarter, while financial services climbed 9 percent, the data showed.
Construction expanded 11.3 percent, reflecting the fast pace at which new buildings are rising across the country, the statistics office said.
This article was written by Helen Nyambura-Mwaura from Bloomberg and was legally licensed through the NewsCred publisher network.