Kenya's exports to Iran have plummeted by 40.7 percent in the first quarter of 2026, a significant decline attributed to trade disruptions caused by the escalating conflict in the Middle East.

• Exports dropped to Sh544 million from Sh917.6 million year-on-year.
• The East Africa Tea Trade Association (EATTA), represented by its managing director George Omuga, highlighted the impact on tea shipments.
• Disruptions to shipping routes through the Strait of Hormuz, following strikes by the US and Israel on Iran, have increased shipping costs and caused delays.

Global rating agency Moody’s has downgraded its 2026 economic growth forecast for Israel to 3.7 percent due to ongoing security risks and sustained high defense spending.

• Moody’s has lowered its 2026 growth forecast for Israel to 3.7%, down from an earlier projection of 5%.
• The downgrade by Moody’s reflects the lingering economic impact of the security situation, despite recent de-escalation agreements.
• Despite the weaker forecast, Moody’s affirmed Israel’s sovereign credit rating at Baa1 with a “stable” outlook, citing the economy's resilience, strong tech sector, and good access to financial markets.

Rising geopolitical tensions in the Gulf could lead to higher fertilizer costs for Kenyan farmers, according to the World Trade Organization (WTO).

• Kenya is identified as one of the most vulnerable import-dependent economies due to its heavy reliance on nitrogen fertilizers from Gulf producers.
• The WTO estimates that export restrictions during recent conflicts affected up to 15 percent of global fertilizer trade, with a potential rise to 23.3 percent if trade through the Strait of Hormuz is disrupted.
• This situation poses risks to food security and could fuel food inflation in Kenya, which is still recovering from previous fertilizer price shocks.