Wednesday, April 7, 2021 –
The International Monetary Fund (IMF) has responded to Kenyans who were questioning why the Bretton Woods Institution is giving the Kenyan Government a loan of Sh 255 billion.
In a statement on Wednesday, Antoinette Sayeh, IMF deputy managing director, said IMF loaned Kenya Sh255 billion to help in the containment of public debt.
Antoinette said Kenya was undergoing financial distress as a result of the accrued debts that it was servicing.
The lender further stated Kenya found itself in a debt pool after the Covid-19 pandemic ravaged its economy.
Kenya has large financing needs on account of the adverse effects that the Covid-19 pandemic has created,” said the IMF, suggesting why the country needed the money.
The lender said some of the financial challenges Kenya is facing, had been outlined in the 2020/2021 financial year budget, and that not all the money lent to Kenya was going to be used on emergent needs such as battling the adverse effects of Covid-19.
The IMF said Kenya was falling short of meeting its budget financing, and the agency, therefore, chipped in to help the country have a disposable amount to allow for normal governance operations, even as it settled its other foreign and domestic debts.
“The central objective of the [IMF loans] program [to Kenya] is to gradually stabilize public debt,” said the lender.