The IMF Executive Board has completed the review of Kenya’s economic programs, approving KES 78.1 Billion ($606 million) in combined disbursements.
According to IMF, the new 78 billion shilling loan disbursement is aimed at supporting efforts to strengthen public finances and enhance resilience to climate shocks while protecting priority social spending.
“We recognize the complex balancing act Kenya faces: boosting domestic revenues to protect critical spending while meeting debt obligations. Our recent adjustments will reduce Kenya’s interest payments to the IMF, demonstrating our commitment to providing sustainable support.” Stated IMF in a statement
But according to senior business analyst, Julians Amboko, Kenya has actually received less than it bargained for in the $606M disbursement;
“If you check the 2024/25 borrowing plan, the amount penciled in for disbursement under the 7th & 8th Reviews was in the order of US$874.0 million. With the approved amount standing at US$606.0 million, GOK is bound to face some funding pressures in the days ahead. Julians stated
With this in mind, the government may be forced to devise and revisit other means of raising revenue.
“Given the quantum of this disbursement, I now expect GOK to revive with gusto the conversation around a Tax Laws (Amendment) Bill seeking to rescue some Finance Bill 2024 revenue-raising measures. added Julians.
This latest review follows a meeting by the IMF The International Monetary Fund (IMF) Executive Board that focused on the 7th Review of Kenya’s ECF/EFF & the 2nd Review of the Resilience & Sustainability Facility on Oct 30th.
“Improved governance and transparency remain essential to restore public trust in the effective use of public resources. We stand with Kenya on this journey, supporting crucial economic reforms and keeping the well-being of Kenyan citizens at the forefront.” Concludes the statement by the IMF
