The World Bank has warned that corruption is significantly hindering Kenya's economic growth, estimating that the practice costs the country approximately 2% of its GDP annually. According to the World Bank, corruption and collusion are worsening Kenya’s public finances, widening the fiscal deficit by about two percentage points of GDP.
The report highlights that businesses in Kenya are increasingly affected by corruption, with 39% of firms considering it a major or severe constraint in 2025, up from 25% previously. This rise reflects growing concerns among local businesses about the impact of corrupt practices on their operations and profitability.
The World Bank has identified weak governance as a fundamental constraint on economic development in Kenya. Qimiao Fan, the World Bank Division Director for Kenya, Rwanda, Somalia and Uganda, emphasized that addressing corruption is crucial for achieving the country’s economic potential. The report suggests that improving governance and reducing corrupt practices could lead to a significant increase in Kenya’s GDP, potentially reaching 22% growth by 2035.
The findings underscore the need for stronger anti-corruption measures and improved public financial management. While Kenya has made progress in recent years, the report indicates that more action is required to ensure sustainable economic growth and development.
