Deloitte Ranks Kenya behind Ethiopia in Infrastructure Spend


Ethiopia’s breakneck speed in modernizing its infrastructure is expected to see the economy overtake Kenya’s in 2016. The country has spent the equivalent of 32.8% of its GDP on infrastructure, according to Deloitte.

By Neville Otuki (Business Daily) |

Ethiopia’s investment in roads, railway, industrial zones and power plants is the highest in Africa relative to GDP, well ahead of Kenya.

An analysis by financial consulting group Deloitte shows expenditure on infrastructure projects by Addis Ababa stands at 39 per cent of the total economic output, also known as gross domestic product (GDP).

This is above what is seen as the global ideal level of 30 per cent, Deloitte says.

Kenya’s public and private spending on infrastructure is 21.5 per cent of GDP – the same rate as the average for sub-Saharan Africa.

“Ethiopia stands out for its consistent gross fixed capital formation (GFCF) spend and has one of the highest GFCF ratios globally,” said Deloitte’s partner in charge of Infrastructure and capital projects J-P Labuschagne.

Ethiopia’s breakneck speed in modernizing its infrastructure is expected to see the economy overtake Kenya’s in 2016.

READ: Ethiopian Sugar Corporation: Country’s Sugar Revolution Attracted New Investor: Aliko Dangote

The International Monetary Fund (IMF) last year estimated that Ethiopia’s GDP would grow to $69.21 billion in 2016 from $61.62 billion a year earlier, narrowly beating Kenya’s output of $69.17 billion from $63.39 billion in 2015.

“Ethiopia has recorded double-digit economic growth, averaging 10.8 per cent since 2005, which has mainly been underpinned by public-sector-led development,” the institution said in its estimates for last year.

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