Kenya seeks $750m loan from World Bank
http://www.hrlnews.com/2019/05/kenya-seeks-750m-loan-from-world-bank.html
Kenya is negotiating with the World Bank for a $750
million loan for budgetary support, documents on the proposed funding
posted on the lender’s website showed.
The East African nation has multiple development
funding programs, worth billions of dollars, with the World Bank but the
funding bypasses the Kenyan treasury and is usually channeled straight
into the projects.
If the $750 million (591.8 million pounds) loan gets
approved, it will be the first time in years the World Bank is putting
cash straight into the Treasury Department to be used at the discretion
of the government, said a source with knowledge of the issue.
The loan, which comes under the bank’s so-called
development policy financing, is designed to support the government’s
policy and institutional reforms and help make economic growth more
inclusive.
The World Bank declined to comment as the loan has not been approved by its board.
Officials at the ministry of finance did not immediately respond to Reuters’ request for comments.
Kenya raised $2.1 billion in a sovereign bond this
month, but some critics have expressed concerns over the country’s
growing debt burden.
There has been a jump in government borrowing since
President Uhuru Kenyatta came to power in 2013 – a rise that some
politicians and economists say is saddling future generations with too
much debt.
Kenya’s public debt as a percentage of gross domestic
product (GDP) has increased to 55% from 42% when Kenyatta took over.
The government has defended the increased borrowing, saying the country
must invest in its infrastructure, including roads and railways.
Finance Minister Henry Rotich told Reuters earlier
this month that he was aiming to bring down debt servicing costs in the
next few years to 12-16%.
Reactions: |