Kenya Seeks Additional IMF Support to Finance Budget After Being Locked out Of Capital Markets

• Kenya sought an additional loan from the International Monetary Fund (IMF) to finance the National Treasury budget
• Central Bank of Kenya (CBK) governor Patrick Njoroge said IMF should double or triple its support to emerging economies to offset challenges from global shocks
• Njoroge noted Kenya was shut from capital markets, making it difficult to access external resources

The Kenyan government requires additional loan support to finance the National Treasury, the Central Bank of Kenya (CBK) has revealed.

CBK governor Patrick Njoroge said the country is pushing for a double or triple loan from the International Monetary Fund (IMF).

Kenya’s access to external loans

Speaking during the IMF Annual Meeting in Washington DC on Thursday, October 20, Njoroge revealed Kenya was shut from the capital markets, limiting its access to external resources.

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“Financial markets have become dysfunctional. We have been shut from the capital markets as we are unable to borrow at appropriate rates. We didn’t get all of these external resources that we were to get from the markets,” said Njoroge, as reported by Citizen TV.

IMF conditions

The governor urged for faster processing of its proposals from the international lender to help offset economic impacts from global shocks

“We would require additional inflows, which would help us right away. A doubling or tripling of access is something that should be put on the table,” he said

In July 2022, Kenya sent its proposals to the IMF, requesting a review of the conditions set in April 2022.

The country sought a waiver of the commitments as it requested for an additional KSh 28 billion loan to finance the fiscal year 2022/2023 budget.

This came after the country failed to meet some of these conditions, including implementing the payroll system, by June 2022.

Source: TUKO.co.ke