The Kenya government has secured a Sh3.28 billion soft loan from Japan to fund its universal healthcare programme, which benefits low-income households.
Treasury secretary Henry Rotich on Monday said the concessionary loan at 0.25 per cent interest has 10-year grace period and will be paid over 40 years.
The funds will be used to expand free maternity services in public hospitals, widen medical cover for poor households and refurbish facilities in 20 arid and semi-arid counties.
“The credit will provide general budget support specifically to the health sector with a view to promoting attainment of universal health care in the country,” said Mr Rotich during the signing ceremony in Nairobi.
Japan had in March pledged to extend the medical credit facility to Kenya during President Uhuru Kenyatta’s state visit to Tokyo where he held bilateral talks with Prime Minister Shinzo Abe.
The Far East nation will also help to strengthen Kenya’s capacity to achieve provision of universal med-care.
The Kenyan government is racing to enable every household access medical care through cover provided by the National Hospital Insurance Fund.
Health secretary James Macharia said the funds will help put 700,000 people in the government-backed medical scheme per county, translating to 32.9 million people across the country.
Japan achieved universal healthcare for its population in 1961.
The country has the highest hospital bed capacity of 13.3 per 1,000 of its population followed by South Korea (11) – far ahead of the United States at 2.9, according to Organisation for Economic Co-operation and Development (OECD).
This is the first time Japan is offering a loan to a health sector policy.
Japan’s funding of development projects in Kenya has grown to Sh469.5 billion over the years, underlying deepening bilateral ties.
Japanese are the financiers and developers of the second container terminal at Mombasa port following the signing of a Sh25 billion deal with the government in March.
The Far East nation is also involved in Kenya’s geothermal power projects at Olkaria, Naivasha.
East Africa’s largest economy is set to become the first country on the continent to host Tokyo International Conference on African Development (TICAD) next year.
TICAD is held every five years and constitutes a major pillar of Japan’s foreign policy towards Africa. Kenya provides a large market for Japanese brands like Toyota, Honda and Sony.