Govt Seeks Kes.477 Billion from IMF After Finance Bill Withdrawal

The government has submitted its economic resuscitation plan to the International Monetary Fund (IMF) for approval, following the withdrawal of the contentious Finance Bill, 2024.

President William Ruto’s administration has sought new funding of Kes.477 billion ($3.6 billion) from the Bretton Woods Institution to cover the deficit created by withdrawing the controversial legislation.

During a presentation to parliamentarians on Monday, National Treasury Principal Secretary Chris Kiptoo revealed that Kenya had already begun discussions with the IMF about the potential disbursement of these funds. He also disclosed that the government is in contact with the World Bank to secure additional financing.

“We are starting discussions on a new program, possibly with the IMF and other partners,” PS Kiptoo told lawmakers.

He added, “The state is already negotiating with the World Bank for new development policy financing.”

Prime Cabinet Secretary Musalia Mudavadi, who also addressed legislators, affirmed the government’s commitment to acquiring more funding from external lenders.

Despite recent developments in Kenya, Mudavadi noted that the national treasury has engaged in robust discussions with the IMF. He stated that these discussions would continue in August, with the disbursement of the multi-billion loan expected by April next year.

“To resolve our debt challenge, we need a program with the IMF. It cannot be otherwise,” Mudavadi told MPs.

Addressing concerns about Kenya’s relationship with the IMF, Mudavadi dismissed allegations of a potential disassociation from multilateral lenders.

“If anyone misleads people by suggesting that you can walk away from the IMF and have your way, it is not true,” Mudavadi clarified. He added, “You need the IMF and the World Bank on your side to get a hearing from your creditors.”

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