Jibran Qureishi, Regional Economist East Africa At Stanbic Bank. [Photo/ dispatch.ug]
Kenya has been challenged to start strategising on how to establish an industrial policy that will drive economic growth rather than focus on starting new infrastructural projects.According to Stanbic Bank Economic Outlook, there is an urgent need for government to emphasize industrial policy rather than persist with a policy focus on attracting financing for the infrastructure-led growth model.“Industrial policy, that would seek to improve the productivity of the labor-intensive sectors like agriculture and manufacturing, would ultimately ensure that excess capacity created by infrastructure built out over the last few years is utilised more efficiently,” the Stanbic Bank report said.Speaking during a briefing on Thursday in Nairobi on ‘Kenya’s Economic Outlook for 2018’, Stanbic Bank regional economist East Africa Jibran Qureishi said the industrial policy is necessary because it will stimulate growth while creating jobs.Qureishi said despite having some economic apprehension, the country is expected to grow by 5.6 percent in 2018 compared to 4.8 realised last year. He said the service sector, better agricultural output as well as continued public investment in infrastructure will be the key drivers of the growth.Qureishi said whereas economic indicators such as inflation, political risk, agricultural production appear to be stable, the biggest threat to realizing the growth would be the rising cost of fuel and fiscal consolidation.Tourism, Qureshi said, will continue with its impressive performance, while cargo movement via Standard Gauge Railway should also bode well not only for logistics but also for the industrial sector over the medium term.