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The International Monetary Fund has granted Kenya a new loan of more than US$941 million to help reinforce the finances of the cash-strapped East African nation
The International Monetary Fund has granted Kenya a new loan of more than USD 941 million to help reinforce the finances of the cash-strapped East African nation. Kenya is grappling with a host of economic challenges including a vast debt mountain, a high cost of living, and erosion of the value of the local currency.
The IMF’s executive board had approved the USD 941.2 million loan, with an immediate disbursement of USD624.5 million, taking the total payout to roughly USD 2.6 billion. The IMF forecasts that Kenya’s economic growth will be at around 5% this year, from an estimated 5.1 percent in 2023.
According to the latest Treasury data released this month, Kenya’s public debt stands at 10.585 trillion shillings (USD 65.5 billion). In December, Kenya faulted on a promise to buy back a portion of a USD 2 billion Eurobond that is due to mature in June. Instead, Finance Minister Njuguna Ndung’u said the country had paid USD 68.7 million in interest on the bond, sidestepping a potential default.
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In the meantime, President William Ruto had announced a plan in November to buy USD 300 million of the Eurobond, saying public debt had “become a source of much concern to citizens, markets and our partners. Ruto has imposed a raft of new or increased taxes to try to replenish government coffers, but they are deeply unpopular among people struggling with rising costs for basic goods, and several have been challenged in court.
