This archive report was first published on 20 June 2020.
On June 19, 2020, the World Bank announced a plan to temporarily suspend debt payments by the world's poorest nations, which could save Kenya up to Ksh85.3 billion.
The Debt Service Suspension Initiative (DSSI) is urgently needed to allow low-income countries to concentrate their resources on fighting the COVID-19 pandemic.
According to the World Bank, Kenya is set to be the third biggest beneficiary of the scheme, with Angola leading the list with an expected saving of Ksh358.5 billion, and Pakistan second with Ksh257.6 billion.
Kenya was classified as being under high risk of external and overall debt distress.
The World Bank is monitoring spending, enhancing public debt transparency, and ensuring prudent borrowing under the DSSI.
Beneficiaries commit to disclose all public sector financial commitments and limit their non-concessional borrowing.
Under the DSSI, the world's poorest countries could save over Ksh1.2 trillion owed to sovereign and other creditors this year.
On May 2020, the World Bank Board of Directors approved a Ksh100 billion budget for Kenya to help close the fiscal financing gap.
