Kenya first stop in IMF boss Africa visit

The IMF managing director, Mr Dominique Strauss-Kahn, is expected to start his African tour by visiting Kenya mid next month, marking the institution’s highest profile visit to the continent since the global economy started showing signs of returning to positive growth.

An advance group of International Monetary Fund (IMF) officials are already in Nairobi to lay the groundwork for Mr Strauss-Kahn’s itinerary which will also see him visit South Africa and Zambia.

Emergency loan

The IMF released to Kenya $200 million (about Sh15 billion) emergency loan facility in June last year, to help rebuild depleted foreign currency reserves as the country suffered a slump in foreign currency inflows following the 2008 global financial crisis.

The group’s officials who later visited the country in December gave their approval of policies applied by Treasury and the Central Bank of Kenya in their management of the economy which had supported growth recovery, but warned that implementation of structural reforms such as passage of the public finance management bill was taking too long.

The Bretton Woods institution has not yet given an official programme of the director’s visit but it is expected that he will meet with government officials, private sector representatives and civil society groups.

He is also expected to give a public speech at the University of Nairobi.

Strauss-Kahn’s visit is also expected to afford him the opportunity of directly hearing from African policy makers and opinion leaders on the best way the fund can support economic growth on the continent.

Although Kenya’s reliance on the IMF and World Bank loans for budgetary support has diminished considerably over the past decade, the country maintains crucial economic policy advisory ties with the two institutions.

“Any positive interactions with the two institutions is also a big vote of confidence in Kenya’s economy and greatly enhances our capacity to attract foreign investments,” said Mukhisa Kituyi, a former Cabinet minister and currently an international trade consultant.

The World Bank Group President Robert Zoellick skipped Kenya last month on his eight-day, three-nation African tour of Sierra Leone, Cote d’Ivoire and Ethiopia where he also attended the African Union (AU) summit.

The bank’s officials said Zoellick’s visit was aimed at “helping to focus the attention of African governments, development partners and private investors on seizing the opportunity for renewed momentum in economic growth and overcoming poverty.”

Dr Kituyi termed the IMF and World Bank’s view of Kenya as “still very positive” despite the negative publicity that the country continues to attract mainly due to corruption and internal political wrangling.

Most African countries sailed reasonably well over the global financial crisis and subsequent economic recession mainly due to the continent’s relatively loose connection to the hardest hit Western economies but also due to a growth boom that was founded on sound fiscal and monetary policies in the decade preceding the crisis.

Being the regional economic powerhouse and one of the most ardent supporters of the East African Community economic union, Kenya is seen as a natural stop over for the IMF director.