International travel rebound lifts Kenya’s FX earnings

Foreign exchange inflows from international travel/transport rose to Ksh.109 billion ($922 million) in 12 months to April 2022 from a lower Ksh.63.6 billion ($538 million) previously.

Data from the Central Bank of Kenya (CBK) shows the higher receipts help boost services exports by 62.2 per cent across the 12-month period.

The higher travel and transport receipts signal the continued rebound of fortunes from international travel which had been curbed by the stay of COVID-19 related restrictions in the past two years.

Diaspora remittances have nevertheless continued to cover the bulk of foreign exchange inflows into the country.

The remittances for instance totalled to Ksh.469 billion ($3.968 billion) over the 12 months to April 2022 from a previous tally of Ksh.391.1 billion ($3.308 billion).

Other top foreign exchange earners for the country cover tea, horticulture and coffee exports.

The higher FX inflows have however been offset by rising import costs with petroleum products for instance consuming up Ksh.491.5 billion ($4.2 billion) in payments in the period.

The import costs of machinery & transport equipment, manufactured goods, chemicals and food were also higher in the period.

The higher foreign exchange inflows have been integral in supporting the stability of the Kenya Shilling despite the local currency shedding 4.5 per cent of its value against the US dollar since the beginning of the year.