Treasury secures 20 billion shillings AfDB loan for budget and agriculture
Kenya is set to secure 19.8 billion shillings ($170 million) in loans from the African Development Bank (AfDB) this year for fiscal and agricultural support to help its economy recover from the effects of the pandemic. of Covid-19 and the Russian-Ukrainian conflict.
Nnenna Lily Nwabufo, the AfDB’s managing director for East Africa, said the amount of 11.66 billion shillings ($100 million) would go to budget support to help restore Kenya’s economy. on track in a context of inflationary pressure.
“We will provide budget support of $100 million to Kenya this year to help with reconstruction,” she told the business daily in an interview in Accra, Ghana.
ALSO READ: Afreximbank opens 460 billion shillings loan to help Africa against Russian war
“There will also be another $70 million support for fertilizers and seeds since the Russian-Ukrainian crisis has heavily affected the agricultural economy.”
The loan would come on top of Kenya’s recent indebtedness for budget support, although the AfDB has minimized the risk of default.
“Borrowing is not about how much you borrow but what you do with it,” Ms Nwafubo said.
A report by Treasury Cabinet Secretary Ukur Yatani tabled in parliament two weeks ago showed the state took out nine new loans between January and April, totaling 137.93 billion shillings to finance projects.
Six of the new loans come from multilateral lenders and three from bilateral lenders and were contracted between January 1 and April 30.
Some 60.3 billion shillings came from the International Development Association on March 18, which will fund fiscal and debt reforms to make spending more transparent and efficient and improve domestic debt market performance.
ALSO READ: Equity set to secure 11 billion shillings AfDB loan
The loan is also intended to finance the electricity sector and public-private partnership reforms to strengthen the basic public service (Kenya Power), put Kenya on the path to green and efficient energy and stimulate investments. private in infrastructure.
The funds will also finance the strengthening of environmental and natural resource governance, the fight against climate change and the improvement of health care, including the response to the pandemic.
The 26.7 billion shillings acquired from the International Bank for Reconstruction and Development on March 18 are for the second acceleration of reforms for inclusive and resilient financing of the recovery development policy.