Nairobi emerges richest county, Marsabit records fastest growth

Nairobi County has emerged as the richest of the 47 counties with the output of its economy hitting Sh2.6 trillion in 2020.

This is according to the latest data from the Kenya National Bureau of Statistics (KNBS), which indicates that a majority of the counties are still struggling to build their local agricultural and manufacturing sectors a decade after devolution.

The latest Gross County Product (GCP) Report released alongside the Economic Survey 2022, yesterday, indicates that Nairobi's contribution to the country's gross domestic product has stagnated at 26 per cent since the onset of devolution in 2013.

Kiambu, Mombasa, Nakuru and Machakos rounded up the top five richest counties, recording Sh553 billion, Sh467 billion, Sh480 Billion and Sh313 billion in GCP respectively in 2020.

On the other hand, Isiolo, Samburu, Tana River, Lamu and Wajir counties emerged as the poorest, contributing Sh26 billion, Sh29.2 billion, Sh29.8 billion, Sh32 billion and Sh49 billion in GCP respectively. 

The bottom 10 counties in terms of contribution were majorly those in arid and semi-arid areas, where the main economic activity is animal production, with insignificant economic output recorded from other sectors like agriculture and manufacturing.

The top five counties accounted for 46.9 per cent of gross value added (GVA), while the top 10 counties contributed 59.5 per cent of the GVA, indicating that the country's economic wealth is concentrated in a few urban centres.

According to KNBS, 33 out of 47 counties accounted for less than two per cent (Sh197 billion) each in their contribution to the economy.

"Besides diversity in economic activity, densely populated counties were found to contribute more to the overall gross value added compared to counties with relatively low populations," explained the statistics body.

"Counties with vibrant commercial urban centres outperformed those with predominantly rural settings with the exception of Meru, Kakamega and Nyeri that benefitted from having a wide range of economic activities as well as counties rich in agricultural production," explained KNBS.

Marsabit County was ranked the fastest growing with 7.2 per cent growth in GCP in 2014 and 2019, much higher than the country's 4.6 per cent average recorded over the same period of time.

Elgeyo Marakwet, Mandera, Samburu and West Pokot rounded up the top five fastest-growing counties.

According to the KNBS, agricultural counties like Bomet, Kericho, Murang'a, Trans Nzoia, Nyandarua and Elgeyo Marakwet registered larger economic output than those that rely heavily on other activities that are less significant economically.

National Treasury Cabinet Secretary Ukur Yatani said most counties are underperforming in generating their own source revenue, 10 years after devolution.

"Devolution was expected to create a nucleus of growth at each of the county headquarters," said Mr Yatani, adding, "Most of the counties are doing well, but there are those lagging because of lack of good stewardship."

According to the CS, many governors in the first term of devolution did not have clear economic strategies for their counties, and there was a duplication of roles and functions. "We've realised that the county and municipal councils in the past were in many places generating more revenue internally than the current county governments," said Mr Yatani.

"The current county governments have better capacity, infrastructure and the necessary resources and skills," he said. "Unfortunately because of certain inefficiencies and the fact that they get resources from the National government, they have relaxed and hardly collect enough."      

A report by the Commission for Revenue Allocation (CRA) last year ranked Embu, Kajiado and Laikipia counties as the best performers in terms of local revenue administration over the past six years.

Embu County registered the largest growth in local revenue collection from Sh168 million in 2013 to Sh629 million in 2019. Bungoma and Garissa similarly reported 256 per cent and 202 per cent growth in local revenue over the same period. 

Overall, Nairobi, Mombasa, Machakos, Nakuru, Kiambu and Narok counties emerged top, generating an average of Sh1 billion annually from local sources between 2013 and 2019.