Kenya is set to receive a loan of $2.4 billion (Sh262.68 billion) from the International Monetary Fund (IMF) to support the country’s second phase of COVID-19 response.
On Tuesday, IMF announced it reached an agreement with Kenya on a 38-month program, with disbursement expected to start in the coming weeks.
An IMF delegation under the leadership of Mary Goodman conducted virtual missions in the country in December 2020 and in February this year to undertake negotiations on the program.
“I am pleased to announce that the Kenyan authorities and the IMF mission team have reached agreement on economic and structural policies that would underpin a 38-month program under the EFF and ECF arrangements for about US$2.4 billion.”
“The program will support the next phase of the country’s COVID-19 response and the authorities’ plans for a strong multi-year effort to stabilize and begin reducing debt levels relative to GDP, laying the ground for durable and inclusive growth over the years to come,” said Goodman.
This is the second loan Kenya is receiving from the Washington-headquartered international lender since the outbreak of the COVID-19 pandemic early last year.
The country received Sh79.3 billion from IMF in May last year to help address the impact of the COVID-19 pandemic on the economy.
Kenya’s debt ceiling is expected to surpass the set Sh9 trillion mark even as the National Treasury struggles to prepare the budget for the fiscal year 2021/22 amid revenue constraints.
The Treasury is expected to seek a new debt limit of Sh12 trillion as per the proposed amendments to the Public Finance Management Regulation.