It seems that Kenya’s borrowing spree will not end any time soon. Even when there is a public outcry against the recently approved KSh255 billion IMF loan to Kenya, the National Treasury is planning to borrow more loans.
Treasury is currently in talks for the disbursement of a new KSh82 billion loan from the World Bank.
In a statement on Wednesday, Treasury says talks are at an advanced stage to have the country receive the facility dubbed World Bank Development Policy Operations (DPO) by end of June.
Treasury CS Ukur Yatani says that the facility will be used to bolster growth and reforms in four key areas namely; fiscal reforms, unlocking public-private partnerships (PPPs), enhancing revenues and strengthening debt management.
In 2020, World Bank disbursed KSh107 billion as part of DPO programme to cushion the economy from the adverse effects of the COVID-19 panemic.
In 2019, World Bank disbursed KSh82 billion as a direct support.
“Given Kenya’s financing needs, the domestic market is projected to be an important source of public financing, particularly during the early phase of the program,” the IMF says. “This now explains the current push to increase the debt ceiling beyond the Sh9 trillion limit.”
By the end of last year (2020), Kenya had about 40 percent multilateral creditors and 33 percent bilateral creditors.