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Kenya increases size of economy by fifth in statistical revision
By Katrina Manson in Nairobi and Javier Blas in LondonAuthor alerts

Kenya’s economy is a fifth larger than previously estimated, the government has told foreign investors looking to buy into the country’s debut sovereign bond.
Nairobi is revising the way it calculates its gross domestic product, following in the steps of Nigeria which earlier this year became Africa’s largest economy after saying its GDP was 89 per cent larger than previously thought.

As a result of the statistical revision, “the Kenya National Bureau of Statistics’ initial estimates for the revised GDP estimate for 2009 is 486.6bn shillings ($5.54bn) higher than previous estimates . . . a 20.6 per cent increase in the level of GDP previously reported”, states the prospectus for the sovereign bond, seen by the Financial Times.
The increase puts Kenya’s GDP for 2009 at about $37bn, rather than the previous estimate of $31bn. Scaling up the 2013 figure by the same factor would mean the size of Kenya’s economy reached $50bn last year, propelling it for the first time into the middle-income category, based on the World Bank’s definition.
Until now, Nairobi had said that it would release its new GDP estimates in September, adding that it had not yet finished the complex calculations needed.
These accounting revisions are a fillip for a country seeking to raise $1.5bn-$2bn on the international market and increase the inflow of foreign direct investment. Kenya is already the largest economy in east Africa.
The statistical boost is the result of bringing forward the base year for calculations from 2001 to 2009. Better data collection also means that all the agriculture, manufacturing and communication sectors grew faster than previously thought.
In other African countries, the inclusion of booming sectors such as telecoms, the film industry and banking have led to sizeable GDP revisions. When Guinea-Bissau, a tiny west African nation, recalculated the size of its economy a few years ago, it discovered it was more than double what had been previously assumed. In 2010, Ghana increased the size of its GDP by 60 per cent.
Kenyan officials are trumpeting the country’s prospects in a roadshow touring the US and Europe ahead of selling the bond next week. The prospectus says Kenya’s economy would grow by 5.8 per cent this year, up from 4.7 per cent in 2013. It also anticipates growth of 6.4 per cent in 2015.
Investors have so far indicated great appetite for the note. Analysts think Kenya is likely to pay an interest rate of around 7-7.5 per cent – or even lower – if it raises $1.5bn, and 7.5-8 per cent for $2bn.
African countries raised a record $11bn through foreign-denominated sovereign bonds last year, up from $1bn in 2000. Kenya had first planned its market debut in 2007 but a series of political, economic and legal shocks have forced it to delay the sale several times.
The prospectus states that many of these risks still haunt the country, however.
The list includes high crime and terror threats, economic risks associated with “chronic” electricity shortages, a rising public sector wage bill, stark economic inequalities, political “volatility and violence” and corruption.
“Failure to address actual and perceived risks of corruption and money laundering may adversely affect Kenya’s economy and ability to attract foreign direct investment,” it says.
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Continent’s GDP could be worth $2tn
Africa’s economy could be a third larger than assumed as more countries on the continent revise the size of their gross domestic product to take into account booming sectors such as banking and the mobile phone industry, writes Javier Blas.
At a recent regional meeting, Mthuli Ncube, chief economist at the African Development Bank (AfDB), told delegates that the new statistical estimates were producing, on average, a 30 per cent increase on the size of the GDP. “From the work we are doing in rebasing [the GDP], we think the final figure [for Africa’s economic size] will be closer to $2tn, if not higher,” he said.
Official figures put the current size of Africa’s economy at $1.5tn.
Although upward revisions of the size of Africa’s GDP will not put more money in the pockets of consumers, it could generate a “feel-good” factor in perceptions of the continent and boost inward investment. .
Stuart Culverhouse, chief economist at Exotix, a frontier markets specialist in London, said the revisions would have a positive impact in the psychology of foreign investors. “If countries are bigger, investors are more likely to look at them,” he said.
 

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Kenya increases size of economy by fifth in statistical revision
By Katrina Manson in Nairobi and Javier Blas in LondonAuthor alerts

Kenya’s economy is a fifth larger than previously estimated, the government has told foreign investors looking to buy into the country’s debut sovereign bond.
Nairobi is revising the way it calculates its gross domestic product, following in the steps of Nigeria which earlier this year became Africa’s largest economy after saying its GDP was 89 per cent larger than previously thought.

As a result of the statistical revision, “the Kenya National Bureau of Statistics’ initial estimates for the revised GDP estimate for 2009 is 486.6bn shillings ($5.54bn) higher than previous estimates . . . a 20.6 per cent increase in the level of GDP previously reported”, states the prospectus for the sovereign bond, seen by the Financial Times.
The increase puts Kenya’s GDP for 2009 at about $37bn, rather than the previous estimate of $31bn. Scaling up the 2013 figure by the same factor would mean the size of Kenya’s economy reached $50bn last year, propelling it for the first time into the middle-income category, based on the World Bank’s definition.
Until now, Nairobi had said that it would release its new GDP estimates in September, adding that it had not yet finished the complex calculations needed.
These accounting revisions are a fillip for a country seeking to raise $1.5bn-$2bn on the international market and increase the inflow of foreign direct investment. Kenya is already the largest economy in east Africa.
The statistical boost is the result of bringing forward the base year for calculations from 2001 to 2009. Better data collection also means that all the agriculture, manufacturing and communication sectors grew faster than previously thought.
In other African countries, the inclusion of booming sectors such as telecoms, the film industry and banking have led to sizeable GDP revisions. When Guinea-Bissau, a tiny west African nation, recalculated the size of its economy a few years ago, it discovered it was more than double what had been previously assumed. In 2010, Ghana increased the size of its GDP by 60 per cent.
Kenyan officials are trumpeting the country’s prospects in a roadshow touring the US and Europe ahead of selling the bond next week. The prospectus says Kenya’s economy would grow by 5.8 per cent this year, up from 4.7 per cent in 2013. It also anticipates growth of 6.4 per cent in 2015.
Investors have so far indicated great appetite for the note. Analysts think Kenya is likely to pay an interest rate of around 7-7.5 per cent – or even lower – if it raises $1.5bn, and 7.5-8 per cent for $2bn.
African countries raised a record $11bn through foreign-denominated sovereign bonds last year, up from $1bn in 2000. Kenya had first planned its market debut in 2007 but a series of political, economic and legal shocks have forced it to delay the sale several times.
The prospectus states that many of these risks still haunt the country, however.
The list includes high crime and terror threats, economic risks associated with “chronic” electricity shortages, a rising public sector wage bill, stark economic inequalities, political “volatility and violence” and corruption.
“Failure to address actual and perceived risks of corruption and money laundering may adversely affect Kenya’s economy and ability to attract foreign direct investment,” it says.
***
Continent’s GDP could be worth $2tn
Africa’s economy could be a third larger than assumed as more countries on the continent revise the size of their gross domestic product to take into account booming sectors such as banking and the mobile phone industry, writes Javier Blas.
At a recent regional meeting, Mthuli Ncube, chief economist at the African Development Bank (AfDB), told delegates that the new statistical estimates were producing, on average, a 30 per cent increase on the size of the GDP. “From the work we are doing in rebasing [the GDP], we think the final figure [for Africa’s economic size] will be closer to $2tn, if not higher,” he said.
Official figures put the current size of Africa’s economy at $1.5tn.
Although upward revisions of the size of Africa’s GDP will not put more money in the pockets of consumers, it could generate a “feel-good” factor in perceptions of the continent and boost inward investment. .
Stuart Culverhouse, chief economist at Exotix, a frontier markets specialist in London, said the revisions would have a positive impact in the psychology of foreign investors. “If countries are bigger, investors are more likely to look at them,” he said.
What do they mean the Continents economy could be worth 2 trillion, don't any of this idiots ever get up to date stats?
 

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Discussion Starter · #3 ·
Yeah it's odd. I guess it's been a little tough keeping up with the changes. Angola rebases too soon
. Can a mode change the title. The first word should be Kenya. My phone messed it up
 

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Yeah it's odd. I guess it's been a little tough keeping up with the changes. Angola rebases too soon
. Can a mode change the title. The first word should be Kenya. My phone messed it up
I think they are biased to throw around low numbers for Africa. Somehow no one says anything if you get the number low but overestimates are heavily criticized. Or worse they using the term Africa but meaning Sub Saharan Africa without South Africa.
 

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Discussion Starter · #5 ·
I think they are biased to throw around low numbers for Africa. Somehow no one says anything if you get the number low but overestimates are heavily criticized. Or worse they using the term Africa but meaning Sub Saharan Africa without South Africa.
I think you're right. With ssa bring the new growth area they're struggling with how go describe africa to the world. Eventually they'll come to terms with it
 

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I think they are biased to throw around low numbers for Africa. Somehow no one says anything if you get the number low but overestimates are heavily criticized. Or worse they using the term Africa but meaning Sub Saharan Africa without South Africa.
The low numbers are provided by incompetent African statistical services who didnt move with the times.

Every African nation should now be dojng this
 

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life liver
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Africa is not a country, its a continent. Why do we have to embrace this ONE CONTINENT mentality when competing on the global scene. South Africa, Egypt, Nigeria all have economies larger than a dozen or more European countries. As for Kenya it accounts for half of East Africa's economy, their GDP should be higher than projected.
You must be unaware of African history. There are no differences between African countries and the people living in them any more than there are between the tribes already grouped together during the Berlin conference, with a few exceptions. Most Africans see this and that's why this united Africa mentality persists.

Just to illustrate, in Kenya there are Bantu Nilotic and Cushitic people, all distinctly different in ethnicity, language and traditional lifestyle. A Bantu living in Kenya has more in common with a Bantu living in Nigeria both in terms of language (the sounds and way of speaking and sometimes the words) and genetically and culturally than he does with a Nilotic person living a few km away, so naturally there is that pan African mentality.
 

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I'm The King
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You must be unaware of African history. There are no differences between African countries and the people living in them any more than there are between the tribes already grouped together during the Berlin conference, with a few exceptions. Most Africans see this and that's why this united Africa mentality persists.

Just to illustrate, in Kenya there are Bantu Nilotic and Cushitic people, all distinctly different in ethnicity, language and traditional lifestyle. A Bantu living in Kenya has more in common with a Bantu living in Nigeria both in terms of language (the sounds and way of speaking and sometimes the words) and genetically and culturally than he does with a Nilotic person living a few km away, so naturally there is that pan African mentality.
There are no Bantu people in Nigeria. I think you mean, Cameroon.
 
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life liver
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In Swahili, the word "watu" means people.
still, we're getting sidetracked. My reply was meant to explain just one of the aspects of why there is a "one continent mentality", there are many other such as shared persecution by colonial powers, and the subsequent struggle against them, but this isn't the thread.
 

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Mutu ya Chuma.
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are people from Cross Rivers Bantu? how do you even know when you encounter a bantu lol.
Language , Names and certain other customs.

How a a Bantu ethnic in Cameroun has linguistic and some custom similarity with another Bantu in Kenya, South Africa, Angola etc.. Its not like there was a super colony or empire to link them together in such a massive area.

A Nilote is completely different from a Bantu, those from Horn have their own look., the Sahel is different...Costal West Af is the one with facial, physical look with Bantu.
 

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Mutu ya Chuma.
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That argument does not hold water. Where has our pan Africaness gotten us thus far. Japan, Korea, China etc have similar cultures and values but fiercely compete and see where they are now.
There are people who have this sense of togetherness or some type of brotherhood (not sure how to phrase or or right term), not only amongst Africans, but in Europe, Arab world (ethnically Arab), even in the oriental Far East Asia. but they are usually a minority...
 

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life liver
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That argument does not hold water. Where has our pan Africaness gotten us thus far. Japan, Korea, China etc have similar cultures and values but fiercely compete and see where they are now.
There hasn't been very much "pan Africaness". If there were then inter African trade would be more than it is today, and more countries would be working together to build cross border transport and energy infrastructure.
 

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Mutu ya Chuma.
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There hasn't been very much "pan Africaness". If there were then inter African trade would be more than it is today, and more countries would be working together to build cross border transport and energy infrastructure.
You don't need Pan-Africanism to have intesnive Intra Afrcan trade.

What's needed is that African countries need technocrat leaderships. leaders who are smart enough to know that Africa is the future of africa is to trade with itself.

DRC has been trading with EAC, and trade is growing thanks to EAC investment in infras...But your community (minus one member) has evil thinking towards US. that doesn't help the cause.
 

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Kenya must definitely get that GDP up to $200 billions. We should be having free trade throughout the east coast with trains, trucks and aeroplanes running up and down carrying goods and people.

Freedom of movement and trade is the one thing that will propel us forward to prosperity.
 

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Mutu ya Chuma.
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Kenya must definitely get that GDP up to $200 billions. We should be having free trade throughout the east coast with trains, trucks and aeroplanes running up and down carrying goods and people.

Freedom of movement and trade is the one thing that will propel us forward to prosperity.
Its up to big countries (with population of 40 million and up) to really do serius reforms, from Logistical infras, to energy, modern indn agroculture, industrialization...if that does not happen, the continent will stay in slow lane behind the world......I mean lets not kid ourselves, Africa is still importing basic stuff. so, not much will really be done.
 
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