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In the space of a year, Kenya has gone from having the world’s worst-performing stock market to the best-performing. This information is according to BlackRock Inc., the world’s biggest asset manager, as seen on Bloomberg.
Kenya’s inflation since January has continued to ease, alongside its currency which has gone from a steep decline to an impressive increase.
The All-share stock index in Kenya’s capital city, Nairobi, saw a 49 percent increase in 2024, compared to the 43 percent decline it experienced a year prior.
Emily Fletcher, co-manager of the BlackRock Frontiers Investment Trust noted that the turnaround in its stock fortunes is a result of the country’s economic policies initiated under the Ruto administration.
“This volatility has created opportunity,” she said in an emailed response. “Over the past two years, Kenya has seen substantial shifts in both fiscal and monetary policy.”
The economic policies implemented by President William Ruto had made him unpopular in its initial stages, however, since the year began these policies have begun to bear fruit as the country’s currency went from Africa’s worst performing to one of the best performing.
According to Fletcher, as seen in the Bloomberg report, Kenya’s bonds have also gained appeal after the Ruto government raised the country’s benchmark interest rate to 13 percent in the two years prior and reduced the country’s fiscal deficit to around 4 percent of GDP.
Boasting one of Africa’s largest economies, Kenya continues to serve as a pillar of innovation as it headquarters major companies on the continent including East Africa’s biggest brewer, mobile phone service provider, and banks listed on its bourse. – Bloomberg
“The gains have been led by financial firms. Equity Group Holdings Plc, the nation’s biggest lender by market value, has surged 73 percent in dollar terms, while rival KCB Group Plc has jumped 66 percent. -Business Insider Africa
Safaricom Plc, Kenya’s largest mobile phone company, advanced 54 percent. In the 63-member index just one stock has dropped this year,” the Bloomberg report reads.
“The index trades at a price-to-earnings ratio of about 5.6 times. In comparison, South African stocks are at 12 times, while Nigeria at 15,9 times. South Africa’s benchmark stock index has fallen 4,2 percent in dollar terms while Nigeria’s has declined 4,1 percent,” it adds. Business Insider Africa
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