Kenya’s Central Bank seeks a funded IMF program to ease debt repayments, boosting foreign reserves and investor confidence.
Kenya Seeks Funded IMF Program to Tackle Debt
Kenya’s Central Bank Governor has expressed the country’s preference for securing a funded programme from the International Monetary Fund (IMF) to support external debt repayments.
Speaking on 13 August, the governor noted that a funded arrangement—unlike a non-funded one—would directly inject resources into the economy. This funding would help strengthen Kenya’s foreign exchange reserves, maintain currency stability, and bolster investor confidence.
The move comes as Kenya continues to face tight external financing conditions and a rising public debt burden, which stood at over Sh11 trillion as of mid-2024. The CBK believes that IMF-backed financing could also provide room for fiscal reforms, enabling the government to manage obligations without resorting to expensive commercial borrowing.
In contrast, a non-funded IMF programme would focus solely on technical support and policy guidance, without providing fresh capital—an approach the CBK says would be less effective in easing immediate repayment pressures.
The request aligns with Kenya’s ongoing engagement with the IMF, which has already disbursed over $3.6 billion under the Extended Fund Facility (EFF) and Extended Credit Facility (ECF) since 2021. The government hopes that securing a new funded programme will keep the country on a stable debt path while safeguarding economic growth.
