The international Monetary Fund (IMF) has has approved a 38- month program which will see Kenya receive a total of Ksh 255.1 billion ($2.34 billion) in loan support.
The loan program has been achieved under the the Extended Credit Facility (ECF) and the Extended Fund Facility which serve to cover countries with short and medium term balance of payments problems arising from structural weaknesses.
“Kenya was hit hard at the onset by the COVID-19 pandemic. With a forceful policy response, the economy has been picking up heading into 2021 after likely posting a slight contraction of 0.1 per cent in 2020. Even with this recovery, challenges remain in the return to durable and inclusive growth, and past gains in poverty reduction have been reversed,” said the IMF Executive Board.
The IMF’s structural adjustments program are in effect started from January which saw ending of cushioning Kenyans amidst Covid-19 crisis.
According to the 2021 Budget Policy Statement, Kenya’s public debt as of June 2020 stood at Sh7.06 trillion, which is equivalent to 65% of GDP.
At the same time the Treasury in its Post Covid-19 Economic Recovery in November 2020 stated that the public debt was at Sh 8.41 trillion.
Kenyans are not happy with the agreement between Kenya and IMF Executive Board to lend any amount to Kenya, given that there are no substantial developments to show from previous loans. Kenyans don’t have any trust to the government handling any amount be in loans or grants, the amounts given only benefit the politicians and their families, according to Kenyans.
Robert Mwangi posed: “What measures have you put in place to ensure the money is strictly used for the intended recipients and purpose? Remember we the poor Kenyans will bear the brunt when the borrowed funds are misappropriated”
Regina Matheka added: “We don’t want more loans. Kenyan citizens are already overburdened. Our government is corrupt, the money will go to individuals’ pockets instead of the said beneficiaries. Please IMF listen to us.”
“Why does IMF keep advancing money to our government knowing very well it will never be disbursed for Wananchi benefit?” asked Sandrah Kimani.
“Stop giving the Kenyan government loans. The money is just embezzled by a few corrupt individuals hence the burden of repaying the loan is placed on the common citizens. We are currently overburdened with high taxation to repay these loans which only benefit few individuals,” wrote Kelvin Lee.
Is this reason that Kenyans have started online petition to have IMF to cancel the loan to Kenya.