The International Monetary Fund (IMF) has approved a $606 million loan to Kenya, part of a broader $3.6 billion facility established since 2021. This funding aims to assist Kenya in rebuilding fiscal and external buffers while enhancing resilience to climate shocks.
The approval follows the completion of the seventh and eighth reviews under the Extended Fund Facility (EFF) and a review under the Resilience and Sustainability Facility (RSF). The funds will be disbursed in two tranches, with $485.8 million allocated under the EFF/ECF arrangements and $120.3 million under the RSF.
The IMF emphasized the need for improved governance and transparency to restore public trust in resource management, as Kenya navigates a challenging economic landscape marked by high debt service obligations and a tax revenue shortfall.
Despite these challenges, the IMF noted that Kenya's economy remains resilient, with growth exceeding the regional average and inflation decreasing. The approval of this loan is expected to bolster market confidence and support the stabilization of the Kenyan shilling.