How economic numbers betray Ruto ahead of 2027 polls

We are officially entering the final quarter of the year 2025. Politically, the window for delivery of promises made to the electorate by elected leaders is closing on them.

Recent political party caucuses by the Orange Democratic Party (ODM), Jubilee party and scheduled by-elections next month have elevated political temperatures in the country.

To complicate matters, the immediate former President, Uhuru Kenyatta, stirred controversy in government by offering a rare criticism to the Ruto administration for ending his key programs under the Big Four Agenda like Linda Mama. The Kenya Kwanza (KK) attack machinery has been quick and vengeful.

In terms of official protocols, it is within President Ruto’s rights to initiate whichever programs he perceives to align with his promises to the Kenyan people. He was under no obligation to continue any of Uhuru’s initiatives, especially in a democratic political environment where people elect their leaders through secret ballot. Further, by design, our political institution are never designed for sustainability but merely vehicles to gain State and Political power.  

Technically, in consideration of Uhuru’s remarks, any candidate that the Jubilee Party endorses now for the presidency would easily be perceived as his project. However, if history is anything to go by, Kenyans seem to loathe projects on the ballot.

To be fair to the Ruto administration, the Kenyatta II government cannot claim any superior performance on any metric of developmental transformation. The KK administration, by all intents, is the second side of the coin of the Jubilee government, only much more kleptocratic in the management of our public affairs.  

The debt binge of the Jubilee administration equally stinks as that of the current administration. The plunder of public coffers has only grown bigger in the spirit of it is our time to eat. The lack of clarity on true national priorities and pain points for ordinary folks has only gotten worse.

Other than the self-praise songs, there really is nothing much more to show for the ordinary people. Only those within the feeding trough seem to enjoy the fruits of our electoral outcomes.

Official data has maintained mixed signals as to what is happening on the real side of our socio-economic welfare. Today, we turn our focus on official data from the first seven months of 2025.

Leading indicators

According to the monthly leading economic indicators released by the Kenya National Bureau of Statistics (KNBS) for July 2025, published on Thursday, the shilling returned a mixed performance against major currencies, but strengthening against the US Dollar, the dominant forex currency in the country.

While monthly inflation remained within the policy target of 5 per cent in the medium and long-term, this indicator continued on the increasing trajectory to close the month at 4.15 per cent in July, the highest rate this year. Implicitly, this means a decrease in the basket of goods and services that consumers can afford at retail outlets, given the same amount of money in the previous month.

On cost of credit for households and businesses, July closed on a downward trend due to reductions in the benchmark rates and changes in the pricing model for the credit market.

Overall, there has been growth in private sector credit by commercial banks and other financial institutions. This would be good news to President Ruto’s administration as this may ease access to working capital and hence growth in economic activity both in the short and medium term. That notwithstanding, the average weighted cost of credit by commercial banks remained over the 15 per cent mark.

The sustained decline in treasury bills and bonds rates would be a great boost to the credit market as this increases liquidity among lenders, forcing them to look for alternative investments as the government instruments become less attractive. The stock market is another good news for the KK cheering squad as the Nairobi Securities Exchange has maintained its bullish run for key market benchmark indexes.

This would be sweet music for the Treasury mandarins, especially as they seek to privatize key state agencies through Initial Public Offerings (IPOs). Despite the many legal handles along the privatization path for the KK administration, Parliament seems to have cleared the way for the first major IPO in over 10 years in our capital market.

Should the President, buoyed by the broad-based arrangement with opposition leader Raila Odinga, pull through the Kenya Pipeline IPO, then he would not only raise billions from the capital market, but will also earn himself some bragging rights over his immediate predecessor, who kept on flip-flopping on the agenda of State Corporations reforms.

Mobile money subscribers declined overall, but showed a rebound on volume and value of transactions compared to declines on both indicators in June 2025. Similar increases in trade values in July are a reversal from declines recorded in June.

Key export destinations for Kenya goods remained as Uganda, the USA, with Pakistan substituting the Netherlands in July for the number three slot. Key import sources remained China, India and the United Arab Emirates (UAE).

While seasonal factors may influence our agricultural exports, tea and coffee farmers may not have big smiles to the bank as exports of the two cash crops declined, but with marginal price increase for coffee.

Sugar production and processing has maintained an upward trend.  Exports for non-food items has remained suppressed, indicating low value addition on the country’s production. The other major bouts of smile for the KK bloggers are the rebounds in the construction sub-sector and cement production.

On the auto sub-sector, the number of vehicles assembled locally maintained their downward trajectory from June, indicating squeezing of consumers from luxury consumer goods and services.

Below the Optics

From the foregoing sample indicators, it would appear we need to celebrate the modest gains on the country’s economic activity. However, from multiple mainstream and social media reports, the gains reported in official statistics do not seem to reflect the lived reality on the ground. This brings us to the difficult frontiers of relating with official data. To correctly interpret data, the prevailing business or political environment becomes important.

To start with, the statistics that were released this week are for July 2025, indicating a lag of at least two months. It would also be instructional to note that the political elites in the intervening two months have been propagating a notion of Kenya being the Singapore of Africa. For those of us who track social media trends, the KK social media gang has been in full swing for several weeks now, trying to amplify the narrative propagated by the President.

Formally, in the absence of alternative credible data sources, we can only rely on the official statistics. However, that does not remove the need for us to exercise caution on the risk of potential tinkering of official data to perpetuate a desired political outcome, especially with such a huge time lag between when data was collected and when the official statistics are published.

If anyone doubts this, then they we would need to be reminded of a sudden economic growth in the fourth quarter of 2022, that moved the national average for the year to 7.6 per cent. This growth again suddenly evaporated as soon as the 2022 general election contest was settled.

Speaking at an event in State House to celebrate the exploits of our athletes in Tokyo, the President elevated the discourse to insinuate we shouldn’t be a third-world country. Intuitively, this is on the same day that the July 2025 leading indicators were being published. The analytical dilemma is whether this statement was a random coincidence!