Sharp Daily
No Result
View All Result
Sunday, June 1, 2025
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
Sharp Daily
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
No Result
View All Result
Sharp Daily
No Result
View All Result
Home News

The great depression vs. great recession in Kenya

Nobert Saidi by Nobert Saidi
December 1, 2023
in News
Reading Time: 2 mins read

The terms “Great Depression” and “Great Recession” are frequently employed to characterize periods of profound economic downturn affecting numerous countries globally. Nevertheless, they are distinct concepts with different meanings and ramifications.

A Great Depression denotes a prolonged and profound contraction in economic activity persisting for several years or more. Typically marked by deflation, high unemployment, widespread poverty, social unrest, and political instability, a notable instance occurred in the 1930s, affecting much of the industrialized world for about a decade. While the causes are still debated, factors contributing to the Great Depression include the 1929 stock market crash, banking system collapse, overproduction, decline in international trade, and the failure of monetary and fiscal policies.

In contrast, a Great Recession represents a less severe and briefer economic contraction lasting for at least two consecutive quarters. Characterized by low or negative growth, rising unemployment, falling incomes, reduced consumer spending, and lower business investment, the 2007-2009 recession, triggered by the subprime mortgage crisis in the United States, serves as a recent example. Causes include excessive leverage, creation of risky financial products, lack of regulation, global imbalances, and inadequate crisis response.

The impact of such economic downturns on a country varies based on factors like development level, economic structure, institutional capacity, policy choices, and external environment. Kenya, a lower-middle-income country in East Africa, has faced both growth and stagnation in its economic history, navigating challenges such as poverty, inequality, corruption, climate change, and vulnerability to external shocks.

RELATEDPOSTS

Germany overtakes Japan to become world’s third-largest economy

February 15, 2024

Germany Slips into Recession Amidst Lingering Economic Challenges

May 31, 2023

While affected by the Great Recession, Kenya avoided severe contraction, maintaining a positive growth rate of 1.7% in 2009. Resilience in the agricultural sector, constituting a quarter of the GDP and employing a significant portion of the population, along with expansionary fiscal and monetary policies, supported domestic demand and mitigated global crisis impact. However, negative consequences included declining exports, tourism, remittances, foreign direct investment, widening deficits, currency depreciation, and increased inflation and public debt.

Kenya’s economy rebounded post the Great Recession, achieving an average growth rate of 4.8% per year from 2015 to 2019, reducing poverty and improving social indicators. Yet, the COVID-19 pandemic in 2020 led to a 0.3% GDP contraction. Government measures in health, social, and economic domains supported recovery, with a 7.5% GDP growth in 2021. However, some sectors, notably tourism, continued facing challenges. The outlook for 2022 and 2023 is positive with projected growth rates of 4.8% and 5.0%, respectively, but uncertainty looms due to pandemic risks, high public debt, rising global inflation, and geopolitical tensions.

Estimating the probability of Kenya entering a Great Depression or Great Recession is challenging, contingent on factors beyond the country’s control. Nevertheless, steps to reduce vulnerability and enhance resilience include diversifying growth and revenue sources, strengthening fiscal and monetary frameworks, improving governance and institutions, investing in human capital and infrastructure, enhancing regional and global integration, and addressing environmental and social challenges. Through such measures, Kenya can aspire to become a competitive and prosperous country, ensuring a high quality of life for all citizens.

Previous Post

High Court rejects bid to revive Mumias Sugar insolvency suit

Next Post

Assessing company value through asset performance

Nobert Saidi

Nobert Saidi

Related Posts

News

Co-op Bank posts KES 6.9 billion profit in Q1’2025

May 16, 2025
Agriculture And Economy
News

Lets get Kenya out of FATF list

May 9, 2025
News

The downside of Impact Investing

May 2, 2025
News

Leadership challenges at the University of Nairobi

April 24, 2025
News

Easter eggs and earnings: Growing your nest egg with CMMF

April 16, 2025
News

Geoffrey Ruku declares KES 377M net worth during CS vetting

April 15, 2025

LATEST STORIES

Best investments for Kenyan seniors: Secure, predictable & low-risk

May 30, 2025

Why June is the Secret Sweet Spot for Travel

May 30, 2025

Strategies to elevate more women to corporate leadership

May 30, 2025

Tap on Kenya’s 2025 tech revolution

May 30, 2025

How CURBS supports employers and employees

May 30, 2025

NSE deserves more attention from young investors

May 29, 2025

The silent strain of remote work on Kenya’s urban workforce

May 29, 2025

How Kenya’s crypto bill could reshape the digital economy

May 29, 2025
  • About Us
  • Meet The Team
  • Careers
  • Privacy Policy
  • Terms and Conditions
Email us: editor@thesharpdaily.com

Sharp Daily © 2024

No Result
View All Result
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team

Sharp Daily © 2024