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IMF disburses $447.39 million to Kenya as economic rebound continues

Published

1 month ago

December 20, 2022

Following the review of its lending programme, the International Monetary Fund’s (IMF) board has approved the disbursement of $447.39 million to Kenya.

The IMF in a statement on Tuesday said Kenya’s public debt had begun to “level off” due to fiscal consolidation progress. It added that it has allocated additional financing under an existing facility.

The fund in July had approved a $235.6 million loan disbursement to Kenya as part of a 38-month arrangement under its Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) arrangements.

In April 2021, the East African nation struck a 38-month financing deal with the IMF under its extended fund facility and extended credit facility. The latest disbursement takes the total so far to $1.65 billion.

The monetary body said Kenya’s economy was “resilient” and expected to expand by 5.3% this year, adding that inflation was expected to peak in early 2023.

Kenya under president William Ruto plans to cut expensive commercial borrowing in favour of cheaper sources like the World Bank to reduce the debt servicing pressure on revenue.

The World Bank says Kenya’s economy continued to rebound from the pandemic in 2022 with the real gross domestic product (GDP) increasing by 6% year-on-year in the first half of 2022, driven by broad-based increases in services and industry.

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Progress as Kenya’s January 2023 inflation rate slows to 9.0%

Published

3 hours ago

January 31, 2023

Ifeoluwa Dada

The Kenyan statistics office has revealed that the country’s inflation rate slowed to 9.0% year-on-year in January from 9.1% a month earlier.

The latest inflation figure makes it the third straight month that inflation has fallen in the East African country. The figure hit 9.6% in October, its highest level since May 2017. January’s inflation is still above the government’s preferred band of 2.5%-7.5%.

The statement by the Kenya National Bureau of Statistics shows that on a monthly basis, inflation was 0.2% compared with 0.5% in December.

Inflation inched down to 9.1% in December, the second straight month of decrease, but still above the government’s preferred band of 2.5-7.5%.

Kenya’s central bank on Monday announced a new monetary policy holding its benchmark lending rate steady at 8.75%.

According to African Development Bank, Kenyan economic growth is projected to decelerate to 5.9% in 2022 and 5.7% in 2023, driven on the demand side by a decline in domestic and external demand caused by lower income and by an increase in food and fuel import costs and on the supply side by tepid economic activity across sectors due to cost-push factors.

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Nigeria’s legislature approves extra $2.2 bln central bank loans to government

Published

4 hours ago

January 31, 2023

Ifeoluwa Dada

Nigeria’s debt crisis isn’t going away anytime soon as the country’s lower house of parliament has approved President Muhammadu Buhari’s request to borrow an extra $2.2 billion.

According to the lawmakers, the approval is in temporary advance from the country’s central bank.

Nigeria’s minister of Finance in December made the revelation that the country will henceforth focus on concessionary loans from the World Bank, Islamic Development Bank, African Development Bank, and others for external loans, Ahmed told Reuters in Abuja after a cabinet meeting.

The legislators plan to discuss with officials in order to turn central bank loans to the government worth 23.7 trillion naira ($52 billion) into long-term debt.

President Buhari asked parliament in December for approval to convert central bank’s temporary advance to government into 40-year bonds at 9% interest to cut interest payments but lawmakers questioned the plan.

Government debt in Nigeria averaged 73641.06 USD Million from 2012 until 2022, reaching an all-time high of 103312.80 USD Million in the second quarter of 2022 and a record low of 48361.37 USD Million in the first quarter of 2013.