- In March 2025, the government of Kenya and the International Monetary Fund (IMF) agreed to terminate the ninth review of the loan programme entered in 2021
- Treasury Cabinet Secretary (CS) John Mbadi revealed that Kenya missed about KSh 100 billion from the programme
- CS Mbadi also cited delays and loan reductions from other lenders, including the World Bank and the African Development Bank (AfDB), after termination of the IMF programme
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Kenya missed billions of shillings after it aborted the International Monetary Fund (IMF) loan programme.
President William Ruto’s administration and the IMF mutually agreed to end the loan programme signed in April 2021.
Why Kenya ended loan programme with IMF
Treasury Cabinet Secretary (CS) John Mbadi explained that the ninth review of the IMF programme was impractical to implement, forcing the country to opt for a new programme.
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“The 7th and 8th review delayed. It did not happen during the scheduled period in March, May and June. Rather, it happened in November 2024.
“And that is the time we combined 7th and 8th reviews and got payment from the IMF. After that, to prepare for the 9th review, it was not practical for us. So we mutually agreed to let go the 9th review and start another program,” said Mbadi.
What’ the impact of the terminated IMF programme
IMF disbursement
CS Mbadi revealed that the programme was supposed to disburse $764 million (KSh 99.1 billion), which did not come due to termination.
“The money that we were to get from the IMF of USD764 million, which is almost KSh 100 billion, that one is not coming. So we had to adjust,” he noted.
World Bank load delays
The CS added that the World Bank disbursement of $600 million (KSh 77.8 billion) was pushed to June 2025.
“The is coming in June. Why? The World Bank could not give us money until the Conflict of Interest Bill was passed,” said Mbadi.
AfDB loan delays
The African Development Bank (AfDB) disbursement of $265 million (KSh 34.4 billion) also delayed.
Mbadi assured that the money will be disbursed in the coming weeks after the Treasury’s consultation with the bank.
What Mbadi said about Kenya’s debt repayment
The CS explained that Kenya has settled the Euro bond that was expiring in 2027, through another Euro bond.
“This is after all the conditions precedent have been realised. In this financial year, I want to tell you here today and report that we have not made any commission loan borrowing. We have not borrowed any money commission.
“The money that we borrowed was to manage a liability. So it was like we used a Euro bond to pay off Euro bond, which is coming in 2027. And we did that because we want to be proactive,” he said.
He said the government took the step because it realised that delaying the bond could cause shocks in the economy.
What Ndindi Nyoro said about Kenya’s debt
Mbadi rubbished remarks by the former Budget and Appropriation Committee chair Ndindi Nyoro.
The Kiharu member of parliament argued that the country was on the verge of debt distress due to increased borrowing.
The lawmaker claimed that the government is borrowing from expensive lenders to repay the Euro bond.
Source: TUKO.co.ke
