Citizens Lose Confidence On Future of Economy

Nairobi Star (Nairobi)

Winfred Kagwe

1 July 2011

Kenyans are increasingly becoming pessimistic over the country’s economic future according to new survey findings by TNS-RMS Research Company. A consumer confidence research conducted between March and June established that more than half the population fear inflation could worsen while half feel negative about the future of economy.

The level of optimism has dropped from 79 per cent in September – soon after the promulgation of the constitution – down to 54 percent.

With the inflation rate hitting 14.5 per cent in June from 6.5 per cent in February, many Kenyans are worried because their incomes have not increased.

Melissa Baker, the CEO of TNS RMS says the low consumer confidence is due to the high fuel and food prices, uncertainty about implementation of the new constitution and the approaching election year. “Business conditions are perceived to be getting worse as seen from the declining number, but some are confident that the conditions will improve in the next six months,” says Baker.

The level of optimism is much lower in urban areas with only 42 per cent positive, compared to 52 per cent in rural areas. 92 per cent feel that jobs are not easy to find but they have hopes this situation could improve in the future. “Consumer’s perceptions impact their spending and saving which has a great influence on the market trends, government policies and banks interest rates,”says Baker

Baker says given that half the population is still optimistic about the future of the economy is a good sign that Kenyan consumers are still putting on a brave face despite the burden of high cost of living.

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