This archive report was first published on 18 December 2021.
On December 18, 2021, the International Monetary Fund (IMF) approved the immediate disbursement of KSh. 29.2 billion to Kenya under the Extended Credit Facility (ECF) to support the country's program to address debt vulnerabilities and respond to the COVID-19 pandemic.
According to the IMF, the disbursement brings the total amount disbursed to the country for budget support to KSh. 100 billion. The IMF had approved a USD2.34 billion (KSh. 266 billion) aid package for Kenya in April 2021 to be disbursed over 38 months, under the Extended Credit Facility and the Extended Fund facility.
IMF Deputy Managing Director and Acting Chairperson of the Executive Board, Antoinette Sayeh, noted that Kenya had shown remarkable resilience to the COVID-19 shock in 2020 and is staging an economic recovery. She stated that growth is now estimated to accelerate to 5.9 percent in 2021 and that the country's COVID-19 vaccination program has picked up speed in the second half of 2021.
However, Sayeh also noted that the political calendar is a source of uncertainty and that the authorities should continue executing their multi-year fiscal consolidation plan to reduce debt vulnerabilities. She emphasized the need for bold political commitment by all levels of government to ensure the FY22/23 budget is aligned with the authorities' program.
The IMF also emphasized the need for proactive efforts to address fiscal risks from state-owned enterprises (SOEs) and to strengthen fiscal transparency and governance. The authorities were urged to address legal impediments to begin publishing beneficial ownership information for awarded public tenders in early 2022, proceed with planned audits of COVID-19 spending, and promptly act to follow up on previous audits.
