World Bank has committed to boosting Kenya’s fiscal and debt sustainability in a new six-year multi-billion country partnership framework.
In an exclusive interview with The Star after the launch of Country Partnership Framework (CPF) 2023-28, country director Keith Hansen said the programme will help Kenya to re-create fiscal space that deteriorated due to global shocks.
This is going to support Kenya's fight against rising debt service, the Covid-19 pandemic, climate shocks and global headwinds, and rebuild its fiscal buffers over the medium term.
"The programme will include development policy financing, steady scaling up of the International Finance Corporation (IFC) investments to support the private sector, and technical support to help Kenya capitalise on new trade opportunities," Hansen said.
Acknowledging that corruption is a key impediment to the country's social economic growth, Hansen said the programme will help tackle corruption by building a citizens-led whistle-blower platform to put the government in check.
To avert corruption in the private sector, IFC will support the rollout of private sector codes of ethics and the World Bank will deepen collaboration with development partners to agree and implement a more joined-up strategy on anti-corruption.
The new programme is targeting key social and economic sectors including agriculture, health, tourism, and MSMEs.
According to World Bank, although Kenya’s economy is rebounding from the pandemic and is projected to grow by an average of 5.4 per cent during 2022-24, the ongoing drought and global inflation are causing poverty to rise.
The CPF finds that Kenya is still well positioned to secure more inclusive growth and the WBG is ready to provide the support that targets lagging areas and communities with better services and infrastructure that build household and community resilience.
In doing so, it aims to help Kenya avoid the inequality and productivity traps experienced by other Middle-Income Countries (MICs).
Speaking at the event, Cabinet Secretary National Treasury Njuguna Ndung'u thanked the global lender for supporting Kenya navigate tough social economic tides key among Covid-19.
He said that Kenya is eyeing $750 million (92 billion) from World Bank to stabilise the economy. The amount sought is $350 million (Sh42.7 billion) higher than what the government stated in the 2022/23 fiscal plan.
According to the Fiscal Framework for the year 2022/23, Kenya had planned to borrow $400 million (Sh49 billion) from World Bank.
Yesterday, Ndung'u indicated that Kenya had requested $1 billion close to (Sh122 billion) but the lender declined.
"We have been trying to negotiate this to $1 billion but World Bank has been adamant," Ndung'u said.
Several governors present appealed to the lender to directly fund projects counties saying funds exchequers money rarely reach them.
