NAIROBI (Reuters) – Kenya’s private sector activity fell in June, hit by the impact of widespread protests against a now-shelved finance law, a business survey showed on Wednesday.
The Stanbic Bank Kenya Purchasing Managers’ Index (PMI) fell to 47.2 in June from 51.8 in May. Readings below 50.0 signal contraction.
“Tough economic conditions brought on by the cost-of-living crisis, as well as protests surrounding the country’s finance bill hurt sales volumes,” Stanbic Bank Kenya said in comments accompanying the survey.
“The downturn was partially softened by a rise in new orders across manufacturing, which was the only monitored sector to register growth in June.”
Last week President William Ruto withdrew a contested finance law that would have raised taxes after clashes between protesters and police killed at least 24 people.
However, Kenyan activists have urged people to take to the streets again, calling on the government to take tougher action to curb wasteful spending and corruption.
“In June, momentum in private sector activity declined, reflecting several concerns, top of the list being the proposed increase in taxes via the Finance Bill 2024, and the widespread protests in response,” Christopher Legilisho, an economist at Stanbic Bank, said.
(Reporting by George Obulutsa; Editing by Christina Fincher)
