On Wednesday, March 20, the Kenyan Shilling continued its streak as the best-performing currency globally exchanging at 132 against the dollar.
Traders credited this upturn to a good business year in the tea industry as per Reuters.
Additionally, the shilling which had earlier been expected to hit Ksh200 by June 2023, is now forecast to strengthen.
The reliance on dollar inflows from tea exporters was identified as a huge catalyst in the appreciation of the Shilling a fortnight after it was revealed the sector was now contributing Ksh180 billion.
In March 2024, the Tea Board of Kenya Chief Executive Officer (CEO) Willy Mutai remarked that the tea industry had seen a 32 per cent growth.
Traders further revealed that diaspora remittances had remained on a steady growth trajectory complimenting the revenue brought by the tea sector.
“Kenya's shilling was stable on Wednesday and was forecast to strengthen, helped by dollar inflows from tea exporters and diaspora remittances,” Reuters reported quoting traders.
According to the Central Bank of Kenya, although remittances in the month of February dipped, Kenya was on course for record diaspora remittances.
In January, Kenyans abroad sent home a record Ksh55 billion with the amount reducing slightly to Ksh52 billion in February.
Tea on the other part has continued to grow from strength to strength recording a 31 per cent growth in 2023 compared to 2022.
President William Ruto’s administration has identified a boost in agricultural production and an increase in dollar remittances as long-term plans to stabilise the Kenyan Shilling.
To that end, the Kenyan government has embarked on subsidising production through cheaper farm inputs as well as the exportation of human labour to developed nations.
