The IMF executive board on Wednesday approved the disbursement of $407 million loan to Kenya after it completed the first review of the Extended Fund Facility for Kenya. The board said that Kenyan authorities have shown great commitment to their reform agenda in challenging times, and are taking steps to lower public debt while supporting economic recovery.
On 2nd April this year, IMF signed an agreement with Kenya to disburse a $2.4 billion loan over a period of 38 months under the Extended Fund Facility and Extended Credit Facility. The Board’s decision to disburse $ 407 million brings Kenya’s total disbursements under the arrangements to about US$ 714.5 million.
Kenya’s economy is projected to grow at 6.3% in 2021 according to Kenyan authorities and IMF staff estimates. However, the country still faces uncertainty and pandemic-related pressures. Kenya aims to lower its debt to sustainable levels by increasing tax revenue and tightly controlling government spending.
At the end of the IMF Executive Board’s discussion, Ms. Antoinette Sayeh, Deputy Managing Director at the IMF said, “The Kenyan authorities continue to demonstrate strong commitment to their fiscal reform agenda during this unprecedented global shock. Performance under the EFF/ECF arrangements has been broadly satisfactory despite a challenging environment”.
The IMF team lauded Kenya’s decision to publish comprehensive audits of COVID-19 spending saying that “it is an important step towards strengthened fiscal transparency and accountability and a strong signal of Kenya’s commitment to improved governance in the use of public resources.”