NAIROBI, March 1 (Xinhua) -- Kenya's overall economic health will not suffer major setbacks this year despite shocks linked to an acute dry spell, public debts, volatile geopolitics and disruptions in the global trading regime, an expert said.
Eva Wanjiku, Africa strategy associate principal at Standard Chartered Bank, said that Kenya is in a vantage position to sustain economic growth thanks to growth in diaspora remittances, higher tourist arrivals and concerted efforts to widen the tax bracket and service external debts.
"Kenya's economic growth story that is expected to average 5.6 percent this year is sending positive signals as the country shakes off negative impacts of a prolonged election in 2017 and inflationary pressures linked to drought," said Wanjiku.
She spoke on Thursday evening at a Chinese New Year business roundtable organized by Standard Chartered Bank and attended by Guo Ce, the economic and commercial counselor at the Chinese embassy in Kenya.
Chinese investors based in Kenya also graced the new year business forum that sought to highlight opportunities and challenges in the east Africa's largest economy.
Wanjiku was optimistic that Kenya is in a better position to attract foreign direct investments given the diversification of its economy coupled with ongoing public sector reforms and abundance of skilled labor.
"We expect private sector credit growth to be sustained as the Kenyan shilling become more resilient due to higher volume of horticulture exports and a 20 percent annual growth of diaspora remittances aided by technological platforms," said Wanjiku.
The Kenyan economist downplayed the risk of a debt pile-up saying that the country has the ability to mobilize domestic resources and repay commercial loans from bilateral partners.
"It is encouraging to note the government is moderating public debts and is very keen on tax mobilization. In fact, Kenya is the second highest tax mobilizer in Sub-Saharan Africa after Ghana. It is paying debts using taxes," said Wanjiku.
She said that Kenya has a favorable credit rating that will enhance its ability to raise money from the international financial markets.
Wanjiku said that investments in the government's Big Four Agenda like affordable housing, food security, universal health coverage and manufacturing, are expected to stimulate economic growth.
On external shocks, Wanjiku was optimistic that the issue of Brexit will not have debilitating impact on Kenya's foreign exchange earnings since the country has diversified export destinations.