CBK survey reveals Kenyan businesses’ 2027 election worry as growth expectations fall
Kenyan businesses remain broadly optimistic about the economy, but a Central Bank of Kenya (CBK) survey shows that political uncertainty ahead of the 2027 General Election is emerging alongside weaker growth expectations and other risks to investment. The July 2026 CBK Market Perceptions Survey found that private-sector firms still expect Kenya’s economy to remain resilient […]
The Central Bank of Kenya (CBK) Market Perceptions Survey, conducted in July 2026, reveals that Kenyan businesses continue to express optimism about the economy's resilience over the next year. However, the survey highlights political uncertainty surrounding the 2027 General Election as a factor that could moderate investment activity. Despite this, a majority of private-sector firms maintain moderate growth expectations for the 2026 fiscal year.
Businesses cite several domestic risks as potential obstacles to investment. High operating costs, weaker consumer spending, and elevated fuel and energy prices are cited as challenges. Additionally, fiscal pressures and geopolitical risks are also factors that could impact business expansion decisions. Political uncertainty is specifically mentioned as a concern that could affect the pace of investment activity as the election approaches.
The survey covers responses from 400 private-sector institutions and firms, including 36 commercial banks, 13 microfinance banks, and 200 non-bank private-sector firms. Respondents' growth expectations have softened, with non-bank private-sector firms lowering their 2026 growth forecast to 4.13% from 4.38% in May and 4.91% in March. Commercial banks project a growth rate of 4.64% for 2026, down from 5.14% in January.
The sectors expected to support demand in the near term are agriculture, tourism, trade, and ICT. Among these, trade has the lowest growth expectation at 3.74%, followed by transport at 3.76% and real estate at 3.93%. These sectors are particularly vulnerable to political predictability as they rely heavily on government-funded projects.
Moreover, the survey highlights high debt-servicing costs, increased government borrowing, and fiscal pressures as risks that could constrain private investment. Kenyan banks anticipate private-sector credit growth to be 9.9% in 2026, which is below the 11.7% expectation recorded in January and March.
Despite these near-term concerns, businesses remain cautiously optimistic about Kenya's long-term prospects. The CBK survey projects average economic growth between 5.0% and 5.9% from 2027 to 2031, driven by sectors such as agriculture, services, manufacturing, tourism, construction, infrastructure, and technology. Businesses therefore call for predictable and simplified regulations, reduced fiscal pressures, timely settlement of government pending bills, increased use of public-private partnerships, and restraint on excessive domestic borrowing to maintain macroeconomic stability.
Written by urgent.news from People Daily Kenya's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
