Introduction Kenya is among countries classified by the World Bank as a low income or a developing nation. After attainment of independence, the government stimulated the economic growth through various means. It encouraged small-scaled agriculture through substantial government investments. Kitching asserts that the government invested in agriculture, which remains the backbone of the economy since 24% of the economy’s Gross Domestic Product (GDP) emanates from the sector (34). By 1973, which marked a decade of independence and self-rule, the country estimated the economic growth to be a little shy of 7%. Primarily, agricultural sector had received the most growth and was growing by almost 5% for every fiscal that ensued. By the early 1990s, the economy recorded the worst economic performance. The key sectors in the economy had stagnated with the most vibrant sector, agriculture, having declined by 4.5%. Considering that the Kenyan economy is non-resource, the world oil prices destabilized myriads of the projects that the government had initiated (Kitching 43). The excessive imports substitution and huge export restraints deemed the country unfriendly to investors (Mankiw 56). Continued poor performance by majority of the sectors saw the government-spending decline substantially. Government-owned sectors such as textile industry, dairy industry and meat industries all of which were hitherto fueling economic growth, collapsed. By 1995, the inflation rates had surpassed 100% with unemployment rising to about 56% (Kitching 51). On the one hand, the economic situation was partially orchestrated by the West who denied the Kenyan government foreign direct aid owing to her resistance in adopting structural adjustment programs (SAPs). The international lending institutions introduced the SAPs as an antidote to counter the negative economic growth witnessed among the developing nations. On the other hand, the political environment took the partial blame of the deteriorating and weakening economy. Political influence on monetary and fiscal policies of the country by the end of the century facilitated the continued stagnation of the Kenyan economy. By the dawn of the 21 st century, the economy was recording negative balance of trade and payment with the collapse of tea and coffee, which were the greatest foreign exchange earners by independence. The budgetary deficit was about 14%. Despite these challenges, the Kenyan economy has shown some resilience in the recent past. The political regime of President Moi ended in 2003. The new political leaders adopted Economic Recovery Strategy (ERS). The ERS embarked on reviving key sectors of the economy, enhancing foreign and local investment into the country, public investment for the revival of the collapsed industries besides countering the rising inflation and unemployment rates. The IMF and World Bank decided to review Kenyan appeal for aid positively (Kitching 73). This allowed the government an extra source of government external borrowing that led to the achievement of almost all the objectives of the ERS. By the end of 2007, the country’s inflation rate stood at 4%, the unemployment rate had significantly dropped at 34% while the GDP recorded a positive and substantial growth of 7.1% (Kitching 9). Current Economic Outlook Notwithstanding the efforts made by the government to stimulate growth, political instability has typ