Why Kenya’s Economy Must Deliver for Citizens Ahead of the 2027 Elections

Kenya must move beyond headline GDP growth and macroeconomic stability. Instead, fiscal policy should focus on outcomes that improve daily life for citizens.

As the country heads toward the 2027 General Election, the economy must cushion households against shocks. Without this shift, growth risks remaining a statistic rather than a lived reality.

Stability Without Shared Prosperity

Kenya’s GDP growth is projected at about 5 percent in the medium term. This signals relative macroeconomic stability after years of global and domestic shocks.

Government efforts on fiscal discipline, monetary management, and domestic revenue mobilisation have supported this outlook. However, stability has not translated into better living standards.

For many Kenyans, economic “stability” now means higher costs of living, falling real incomes, limited jobs, and reduced access to public services.

Shrinking Incomes Despite Lower Inflation

Household purchasing power continues to weaken. Real wage earnings per employee fell by 4 percent, from KSh 696,817 in 2022 to KSh 665,418 in 2024.

At the same time, official inflation eased from 7.7 percent to 4.5 percent over the same period. This contrast highlights a growing disconnect between macroeconomic indicators and lived economic realities.

As a result, households feel poorer even as headline figures improve.

Weak Job Creation and Sectoral Imbalances

Job creation remains sluggish. Most economic expansion has concentrated in services and agriculture.

These sectors largely operate informally and offer low wages with little job security. Meanwhile, manufacturing continues to shrink, limiting opportunities for stable and well-paying employment.

This imbalance weakens the economy’s ability to absorb young people and new entrants into the labour market.

Election Cycles and Economic Risk

According to the Institute of Public Finance (IPF), Kenya’s economy shows gradual stabilisation. Investment has also begun to recover.

However, the 2027 General Election presents a major risk. Historically, election periods bring uncertainty, delayed investments, and slower growth.

Unless managed carefully, political cycles could derail current economic momentum.

Fiscal Credibility Under Pressure

Kenya faces tight fiscal space. However, the real challenge lies in how the government allocates and manages limited resources.

Daniel Ndirangu, CEO of the Institute of Public Finance, argues that the focus should shift to actionable reforms. He says every shilling must deliver value in priority sectors such as health, education, food security, water, nutrition, social protection, and gender equality.

Why Kenya’s Economy Must Deliver for Citizens Ahead of the 2027 Elections

Revenue Forecasts and Oversight Gaps

IPF reports persistent revenue underperformance. This points to weak forecasting and unrealistic targets driven by political pressure.

Moreover, frequent use of supplementary budgets undermines fiscal discipline. Stronger parliamentary oversight could reduce misuse and wastage of public funds.

These concerns appear repeatedly in reports from the Controller of Budget and the Auditor General.

Compared to regional peers, Kenya remains overly optimistic in its fiscal consolidation plans. Repeated revisions raise doubts about credibility and implementation.

Rising Inequality and Social Vulnerability

If growth continues to bypass informal workers, women, youth, and climate-vulnerable communities, poverty and inequality will deepen.

Underfunding and under-execution in health, water, nutrition, and agriculture threaten progress toward Universal Health Coverage and food security.

Consequently, households face higher out-of-pocket health costs and weaker social protection.

What to Watch Before 2027

Over the next 12 months, several issues will shape economic resilience:

Credibility of revenue forecasts
Implementation of austerity measures
Transparency in managing the National Infrastructure Fund
Progress in health insurance reforms
Funding trends in gender, water, and agriculture

Each of these areas will determine whether economic stability translates into real protection for citizens.

A Growth Model That Works for People

To accelerate inclusive growth, government policy must prioritise sectors that create decent jobs.

In particular, agricultural financing should focus on productivity, climate resilience, and smallholder support. At the same time, industrial policy must revive manufacturing and value addition.

Ultimately, Kenya’s economy must work for its people. As 2027 approaches, credibility, accountability, and people-centred budgeting will matter more than headline growth figures.