Kenya’s loans from the International Development Association (IDA) for the year ended June 2019 grew to KSh 142.3 billion. IDA is the lending agency at the World Bank. Disbursements from the agency rose by 161% from last year’s KSh 54.6 billion.
In that period, Kenya became the third-highest recepient of concessionary loans from the International Development Association, behind Bangladesh at Ksh 196.5 billion and Ethiopia at Ksh 227.3 billion.
According to Business Daily, the Big Four Agenda represent the largest loan item for the year. In May, the world bank approved a KSh 76.2 billion facility for budgetary support.
Kenya’s debt continues to grow by the day, with public debt recently hitting 6 trillion. While international agencies such as IMF have showed concern over the ballooning debt, Parliament chose a retrogressive credit policy.
For instance, parliament recently raised Kenya’s debt ceiling to 9 trillion. Moreover, there are concerns that the proposed supplementary budget might require more debt financing.
IDA issues concessionary loans to poor countries to fund social projects such as healthcare, education, and clean water. The agency also extends short and medium-term loans to countries that lack creditworthiness. The World Bank loans are at zero interest or low-interest, offering repayment periods of 30-38 years as well as 5-10 years grace periods.
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- Senate Committee Approves Treasury’s KSh 9 Trillion Debt Ceiling
