IMF, Kenya agree on Sh63bn-plus precautionary loan deal
What you need to know:
Kenya and the International Monetary Fund agreed on a stand-by loan of $700 million to $750 million.
Kenya and the International Monetary Fund agreed on a stand-by loan deal to support the country's economic reforms and give it a cushion against outside shocks, the IMF said on Thursday.
The fund added that Kenya plans to treat the loan, which would total $700 million to $750 million (Sh63 billion to Sh67.5 billion), as precautionary.
The deal must still be approved by the IMF's board, which should meet on the issue in late January.
East Africa's biggest economy had first asked for such a facility at the beginning of 2014 to protect it against unforeseen shocks, such as weather-related problems for the farming industry.
"This arrangement would serve an insurance purpose, providing Kenya with access to IMF resources in the event of exogenous shocks," the IMF said in a statement.
The fund said the stand-by loan could help Kenya pursue initiatives such as a multibillion-dollar standard gauge railway, while keeping its debt sustainable.
The railway should help boost Kenya's economic growth to 6.9 per cent next year, compared to 5.3 per cent in 2014.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
