Kenya’s economy expanded by 4.9% year-on-year in the third quarter of 2025, up from 4.2% in the same period of 2024, according to data released Tuesday by the Kenya National Bureau of Statistics.
The figure points to modest acceleration for East Africa’s largest economy amid ongoing debt pressures and fiscal tightening.
Sectoral drivers of growth
Construction surged 6.7%, recovering from a 2.6% contraction in the third quarter of 2024. Higher cement use, increased steel and bitumen imports, and resumed road works plus the affordable housing programme drove the rebound.
Mining and quarrying expanded 16.6% after a 12.2% decline a year earlier, helped by lifted licence suspensions and stronger extraction.
Agriculture, forestry and fishing grew 3.2%, down from 4.0% in 2024. Gains in milk and cut-flower exports were offset by weaker tea, coffee, sugarcane and vegetable production, highlighting continued exposure to weather and global prices.
Services remained a steady pillar, with transportation and storage up 5.2% and solid gains in financial activities and real estate supported by lower borrowing costs after central bank rate reductions.
Fiscal challenges persist
Heavy debt-servicing obligations from past infrastructure borrowing continue to limit spending flexibility under the International Monetary Fund programme.
Inflation stood around 4.4% in the quarter, mainly due to food prices, while the current account deficit widened slightly.
In August President William Ruto projected full-year 2025 growth of 5.6%, following 4.7% in 2024. The latest data keeps the economy aligned with that target.
Analysts emphasise the need for continued structural reforms, careful debt management and favourable agricultural conditions to deliver inclusive growth that reaches ordinary Kenyans facing high living costs and unemployment.
