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Climate resilience: IMF approves $1 billion in funds for Kenya

IMF/Kenya

Climate resilience: IMF approves $1 billion in funds for Kenya

The International Monetary Fund (IMF) has provided Kenya with a significant financial boost, approving a massive $1 billion fund to support Economic Reform and Climate Resilience.

 

This substantial investment recognizes Kenya’s commendable efforts to meet the strict conditions set by the IMF and tackle the complex challenges caused by climate change.

 

The IMF’s executive board has completed the fifth review under the Extended Fund Facility (EFF) and Extended Credit Facility (ECF) arrangements for Kenya.

 

As a result, Kenya received an immediate disbursement of $415.4 million, and the program’s duration has been extended from 38 to 48 months, allowing Kenya more time to implement necessary reforms.

 

Kenya’s partnership with the IMF began in February 2021, when it embarked on a 38-month program focused on reducing debt vulnerabilities. Due to the country’s continued dedication to its goals, the program has been extended by an additional ten months, concluding in April 2025.

 

In addition, Kenya has been allocated an extra $551 million through the Resilience and Sustainability Facility, which aims to enhance the country’s ambitious initiatives in building resilience against the adverse effects of climate change.

 

Despite facing challenges such as severe drought, Kenya has made significant progress in implementing economic reforms, as acknowledged by the IMF.

 

This latest funding injection brings the cumulative disbursements under the ECF/EFF program to an impressive milestone of approximately $2 billion.

 

This considerable financial support demonstrates the IMF’s confidence in Kenya’s ongoing reform efforts and its commitment to addressing emerging challenges.

 

President William Ruto’s administration has been resolute in improving Kenya’s financial landscape by focusing on revenue generation and curbing excessive borrowing.

 

With the country’s public debt amounting to about two-thirds of its gross domestic product, standing at 9.63 trillion shillings ($68.1 billion) in April, according to the National Treasury, the IMF’s augmented package of $3.52 billion provides vital support.

 

This expanded package includes additional funds to strengthen Kenya’s resilience against the impacts of climate change through the Resilience and Sustainability Facility.

 

 

 

 

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