Kenya has reached a staff-level agreement with the International Monetary Fund to access an additional Sh25.51 billion ($209.49 million), following a top-up in the latest review to battle biting drought and cushion the country from foreign funding shocks for essential imports like petroleum products under the current budgetary support programme.
The additional cash is nearly half of the Sh52.73 billion ($433 million) that the IMF will wire in the coming weeks subject to the board’s approval under a 38-month funding programme agreed upon in April 2021.
“This latter amount [agreed on Tuesday] includes proposed augmentation of access of SDR162.84 million [$209.49 million] to cover external financing needs resulting from drought and challenging global financing conditions,” the IMF said in a statement late Tuesday.
The agreement followed the fourth review of Kenya’s $2.34 billion Extended Fund Facility and Extended Credit Facility by the IMF staff between October 25 and November 8.
Treasury Cabinet secretary Njuguna Ndung’u said that based on the review, Kenya has made significant progress on fiscal adjustments required to address debt vulnerabilities.
“The programme has strengthened Kenya's ability to navigate the recent multiple shocks — the Covid-19 pandemic, the impact of the war in Ukraine, the tightening global financial market conditions and the continuing drought affecting food and energy prices,” said Prof Ndung’u.
Upon approval, Kenya would have received nearly two-thirds, or $1.548 billion million, of the conditional funds, which are wired in phases upon meeting conditions set by the Brettonwood institution.
Some of the conditions Kenya has to meet include reforming struggling state enterprises like Kenya Airways, conducting a special audit on Covid-19 expenditure and disclosing owners in companies, which win fatty government tenders.
