Kenya’s trade deficit widens to Sh413.5 billion as imports outpace exports
At the start of the year, the outlook had been positive, with the trade deficit narrowing by 2.7 per cent to Sh375.5 billion, down from Sh385.9 billion in the corresponding quarter of 2024.
Kenya’s trade deficit widened in the three months to June 2025, reversing the narrowing trend recorded in the year’s first quarter.
According to the latest Balance of Payments report by the Kenya National Bureau of Statistics (KNBS), the country’s trade deficit increased from Sh380.7 billion in the second quarter of 2024 to Sh413.5 billion in the period under review—an 8.6 per cent rise.
More To Read
- Motor vehicle sales soar as lending rates fall amid economic recovery
- Construction growth slows amid rising costs, labour shortages
- Kenya’s manufacturing growth slows despite increased borrowing
- Kenya's economy grows 5 per cent in second quarter of 2025- KNBS
- Inflation rises to 4.5 per cent in August, driven by food, transport prices
- 11 per cent of Kenyans use mobile phones they do not own - survey
KNBS attributed the widening gap to faster growth in imports compared to exports.
At the start of the year, the outlook had been positive, with the trade deficit narrowing by 2.7 per cent to Sh375.5 billion, down from Sh385.9 billion in the corresponding quarter of 2024.
Overall, the value of trade in the review period stood at Sh973.6 billion, a 4.5 per cent increase compared to the same quarter of 2024.
“The growth was driven by an increase in both total exports and imports,” KNBS said in the report.
Export revenue
Domestic export revenue grew by 12.8 per cent compared to the same period in 2024, largely supported by higher earnings from coffee (up 69.0 per cent), horticultural products (19.1 per cent), apparel and clothing accessories (18.8 per cent), and animal and vegetable oils (53.5 per cent).
However, foreign exchange earnings from titanium ores and concentrates dropped sharply due to the depletion of mineral deposits in Kwale. Exports of salt and cement also declined, falling from 157.9 thousand metric tonnes and 97.1 thousand metric tonnes in Q2 2024 to 113.4 thousand metric tonnes and 56.0 thousand metric tonnes, respectively.
By Broad Economic Category (BEC), food and beverages contributed 45.0 per cent of total domestic export earnings during the period, mainly supported by primary industrial food and beverages. In contrast, exports of primary non-food industrial supplies contracted from Sh17.9 billion in Q2 2024 to Sh12.0 billion.
On the import side, expenditure rose to Sh693.6 billion from Sh656.0 billion in Q2 2024, a 5.7 per cent increase. The growth was driven by higher imports of industrial machinery (18.0 per cent), iron and steel (84.0 per cent), sugars, molasses and honey (56.9 per cent), and road motor vehicles (38.0 per cent).
Recorded declines
Conversely, imports of petroleum products, chemical fertilisers, medicinal and pharmaceutical products, and unmilled wheat recorded declines of 13.2, 38.2, 12.0 and 15.5 per cent, respectively.
Analysis by BEC showed that non-food industrial supplies accounted for the largest share of imports at 36.0 per cent. Expenditure in this category rose from Sh224.0 billion in Q2 2024 to Sh249.7 billion in the review period.
Imports of transport equipment also jumped significantly, from Sh52.6 billion in Q2 2024 to Sh72.2 billion.
Meanwhile, expenditure on fuel and lubricants dropped to Sh139.8 billion—a decline of 11.7 per cent compared to the corresponding quarter of 2024—driven partly by reduced imports of processed fuel and lubricants as well as shifts in international commodity prices.
Top Stories Today
