UPDATE 1-Kenya aims to reduce budget deficit in next fiscal year

Kenya will cut its budget deficit in the 2019/20 financial year to 5.6% of GDP from 7.4% in the current fiscal year, which ends this month, the Finance Minister Henry Rotich said in his budget proposals to parliament.

The East African economy is one of the fastest growing in the region, expanding by 6.3% in 2018 on the back of a good harvest in a country where farming makes up about a third of output. However, investors have been unnerved by a jump in government debt in recent years. The funding gap will be filled by net local borrowing of 283.5 billion shillings ($2.79 billion) and 324 billion shillings in net external borrowing, Rotich said.

"Our economy continues to be resilient in the midst of significant global and domestic elements. In 2018 our economy grew by 6.3%, up from 4.9 in the previous year... We project growth in 2019 to remain strong at around the same level in 2018," the minister said. ($1 = 101.4500 Kenyan shillings)