Kenya gets US$750mln loan from World Bank

Published : 31 May 2019 06:22 PM | Updated : 07 Sep 2020 09:55 PM

The World Bank said on Wednesday it has approved a 75 billion shilling (about 750 million U.S. dollars) loan for Kenya to support its reforms in agriculture, housing, digital technology and fiscal management.

The loan will support Kenya’s reforms to enhance inclusive growth,

accelerate poverty reduction and achieve its Vision 2030 objective of becoming a middle-income, industrialized country, the World Bank said, agency reports.

“Measures supported by this operation are expected to benefit ordinary Kenyans through better targeting of agricultural subsidies to reach low- income farmers, prosecuting those who engage in fraudulent procurement practices, increasing availability of affordable housing, and improving revenue mobilization,” Felipe Jaramillo, World Bank country director for Kenya, said in a statement issued in Nairobi.

The operation creates a foundation for essential reforms for fighting corruption, liberalizing markets, and enhancing inclusive growth, Jaramillo said.

The loan lends support to the government’s “Big Four” agenda, which prioritizes agriculture, affordable housing, universal health coverage, and manufacturing, the statement said.

The approval came after Kenya raised 2.1 billion dollars in a sovereign bond issue in mid-May to finance some of the infrastructure projects, budgetary expenditure and to refinance part or all of the obligations outstanding under a 2014 Eurobond of 750 million dollars, which is due on June 24, and part of the other debt obligations.

According to the World Bank, Kenya has been one of the fastest growing economies in sub-Saharan Africa over the past decade.

“For this growth to be sustained into the future and help reduce poverty, critical reforms are required,” it said.

World Bank Task Team Leader Allen Dennis said the policy and institutional reforms supported by this operation will help improve the standard of living of ordinary Kenyans.

“The policy reforms will contribute to improving good governance by the reinforcement of accountability and enforcement mechanisms through the use of digital technologies,” Dennis said.