Middle East crisis could push 2.4M more Kenyans into poverty, World Bank warns
By Kenneth Mwenda, April 27, 2026The World Bank says Kenya’s poverty rate could rise sharply in 2026 because of the ongoing Middle East conflict. Higher fuel and food prices, together with falling remittances, threaten to drag between one million and 2.4 million people below the poverty line.
In its Africa Economic Update – April 2026, the bank uses microsimulation models to measure the risk.
“In Kenya, microsimulation estimates suggest that the poverty rate (measured at the US$3 international poverty line) could be 2 to 4.5 percentage points higher in 2026, depending on the extent to which higher fuel prices are passed through to economywide prices,” the report states.
“This would translate into an additional 1 million to 2.4 million Kenyans falling below the poverty line. Urban households are projected to be more heavily affected.”
Many Kenyan families already live on a thin margin. The report shows that the share of Africans living between the Ksh388 ($3) and Ksh1,072 ($8.30) daily income lines grew from 29 per cent in 2000 to 43 per cent in 2022. Only 11 per cent now live above $8.30 a day.
This large group sits just above poverty and feels every price shock immediately. High informality and slow job creation make things worse.
Kenya imports more than half its petroleum products from the Middle East and 26 per cent of its fertiliser. Any disruption raises transport costs and farm input prices. Public transport carries 62 per cent of urban households, so fuel-driven fare increases hit family budgets directly.
Remittances add another serious risk. About 500,000 Kenyans work in Gulf states. Data for March 2026 already recorded one of the sharpest monthly drops in recent years.
The bank estimates Kenya could lose up to Ksh5.17 billion ($40 million) in remittances each month if the crisis continues. Gulf countries also buy Kenyan horticulture and livestock exports, and those sectors have already suffered losses.
The report makes clear that these figures capture only short-term price effects. A longer conflict could cause deeper damage through fertiliser shortages ahead of planting seasons, which would hurt agricultural output and push food prices even higher.
Growth outlook mixed signals
At the same time, the World Bank cut Kenya’s 2026 growth forecast to 4.4 per cent from an earlier 4.9 per cent. External shocks now outweigh recent gains in agriculture and construction.
Yet the report also highlights one area where Kenya leads. Box 2.1 praises the country’s horticulture sector as a model for Africa. Decades of investment in the Kenya Plant Health Inspectorate Service (KEPHIS) and quality standards helped turn cut flowers and vegetables into a billion-dollar export industry.
The bank stresses that public investment in the right infrastructure came before private sector growth took off. Kenya also spends 0.81 per cent of GDP on research and development, one of the highest shares in the region and close to the African Union target.
The government has already taken steps to protect consumers. It cut and redirected fuel levies and used stabilisation funds instead of expensive blanket subsidies. The report says these measures help in the short term, but longer relief requires stronger, well-targeted social protection.
“Targeted policy measures can help mitigate these risks,” the update notes.
It points to the need to expand existing safety nets and improve public spending efficiency to keep support affordable.Urban families face the biggest threat. They spend more on food and transport and rely less on their own farming. If the conflict drags into late 2026, the combined pressure of higher prices and lower remittances could erode years of slow progress against poverty.