Forecasting the growth of imports in Kenya using econometric models

The purpose of the study was to forecast the growth of imports in Kenya using the ARIMA model. Box-Jenkins methodology to forecasting was used. Imports data for the period 1960–2015 was obtained from the Trade Map. Data analysis entailed diagnostic tests and fitting the right model for forecasting. Using the proposed model, ARIMA (13, 1, 13), the results of forecasting showed that the growth of imports in Kenya have fairly increasing trend over the nine years forecasted. The study recommends that the government of Kenya should evaluate its import composition. Kenya should work on importing raw materials and unfinished goods so as to assemble them locally to cut costs.