Kenya and the IMF have cancelled the ninth review of their loan program, moving forward with a request for a new loan program. This decision follows a visit by an IMF team that assessed Kenya’s economic outlook and highlighted ongoing fiscal challenges. Since 2021, the IMF has allocated significant funding to Kenya under the EFF and ECF programs.
In a recent development, Kenya and the International Monetary Fund (IMF) have mutually decided to cancel the ninth review of their ongoing loan program under the Extended Fund Facility (EFF) and Extended Credit Facility (ECF). The announcement came after an IMF staff team, led by Haimanot Teferra, concluded a visit to Nairobi from March 6 to March 14, 2025, engaging with Kenyan authorities to analyze the current economic situation and future outlook.
The conclusion of the mission highlighted a collaborative understanding between the IMF and the Kenyan government regarding the cancellation of the current review. Teferra noted, “The mission team engaged with the Kenyan authorities on recent developments and the macroeconomic outlook. The Kenyan authorities and IMF staff have reached an understanding that the ninth review under the current Extended Fund Facility and Extended Credit Facility programs will not proceed.” Additionally, the IMF received a formal request from Kenya for a new loan program, signifying a shift in strategy moving forward.
High-level discussions during the visit included meetings with key officials such as President William Ruto, Cabinet Secretary for National Treasury Mbadi Ng’ongo, and Central Bank of Kenya Governor Kamau Thugge. These discussions encompassed Kenya’s fiscal challenges, including issues related to debt sustainability, revenue generation, and external financial pressures.
Since April 2, 2021, when the EFF and ECF programs were initiated, the IMF’s financial commitment to Kenya has reached approximately SDR2.714 billion (about KSh 465.76 billion), of which SDR2.343 billion (approximately KSh 402.54 billion) has been allocated for disbursement. Furthermore, Kenya has also been approved for additional financing under the Resilience and Sustainability Facility (RSF) arrangement, totaling SDR407.1 million (around KSh 69.8 billion) and SDR135.70 million (about KSh 23.3 billion).
In summary, the decision to cancel the ninth review of the IMF loan program marks a pivotal moment for Kenya’s economic management. With a focus on addressing fiscal challenges and a request for a new loan arrangement, both the Kenyan government and the IMF appear poised to develop a fresh strategy for future collaboration. This move reflects a proactive stance in addressing the economic realities facing the nation.
Original Source: www.asaaseradio.com
