The new economic update by World Bank attributes the rise to sustained investor confidence in the country that saw the Kenyan economy grow at 5.2 per cent. Kenya’s foreign direct Kenya’s foreign direct investment inflows defied external economic shocks, rising by 170.5 per cent to a record $2.74 billion (Sh354 billion) in the 12 months to September 2026.
The latest economic update by the World Bank attributes the increase to sustained investor confidence, which supported economic growth of 5.2 per cent. This was up from 4.9 per cent over a similar period last year. Growth was supported by stronger activity in the industrial and services sectors.
The surge coincided with a broader recovery in economic activity. Growth accelerated, private-sector lending picked up and foreign exchange reserves strengthened. These developments reinforced Kenya’s position as one of the fastest-growing economies in sub-Saharan Africa.
“Portfolio inflows increased by 54.6 per cent during the same period, driven mainly by stronger non-resident investment in government and corporate bonds, as well as state privatisation proceeds,” said the World Bank. The multilateral lender said stronger capital inflows had helped cushion Kenya against external pressures, particularly higher fuel import costs and disruptions linked to the Middle East conflict.
Industry and services offset slower growth in agriculture, helping sustain economic expansion despite rising global uncertainty, higher energy costs and pressure on household purchasing power. Construction was among the strongest-performing sectors, expanding by 6.3 per cent in the first half of 2026.
Overall industrial growth accelerated to 4.9 per cent, while manufacturing growth improved to 3.3 per cent. The services sector benefited from stronger tourism and digital activity. Accommodation and restaurant services grew by 11.1 per cent, while information and communication activities expanded by 6.1 per cent.
The recovery was also supported by improving private-sector credit, which more than doubled to 10.6 per cent in September 2026, up from five per cent a year earlier. This gave businesses greater access to financing.