IMF takes stand on offering Ruto’s government loans amid reports of high unsustainable external debt
IMF takes a stand on offering Ruto’s government loans amid reports of high unsustainable external debt.
Should Kenya’s government of President William Ruto require further loans, the International Monetary Fund (IMF) has stated that it is willing to do so.
Abebe Selassie, director of the IMF’s African department, revealed to the media on October 14 that the organization aimed to assist governments that were having trouble obtaining funding from other financial organizations.
IMF did, however, say that it will keep collaborating with Kenya to carry out economic reforms.
“We have revolving resources that we need to use to help countries, from those with stronger positions to those in weaker positions.
“The best help we can provide countries like Kenya is providing financing when access to financing elsewhere is more problematic. Should more financing be needed, we, of course, will look at that,” the official stated.
The international institution underlined that Ruto had not yet requested any credit relief in response to the question of whether IMF would grant Kenya relief for its outstanding debt.
This was in response to Ruto’s proposal that lenders provide Kenya and other nations with assistance through modified repayment plans and other options.
“We have not received such a request from the Government of Kenya, and I think it’s really important for me to explain here that the IMF is akin to a lender of last [resort] to countries,” he stated.
During the tenure of former President Uhuru Kenyatta, the IMF was one of Kenya’s largest lenders.
However, it received criticism from the populace, who said it was lending too much money to the government.
The lender approved a Ksh283 billion credit facility in June 2022 for the nation’s economic rehabilitation programs.
Even though Ruto insists that Kenya would repay its loans, the growing debt burden has led the new administration to make suggestions about seeking debt relief.
“I believe it is reckless for anybody to say we cannot pay our debts. I believe that we have what it takes to pay our debts.
“We have a plan as Kenya Kwanza on how to manage debt. We will first slow down on borrowing,” Ruto stated during the Presidential debate in July 2022.
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