Kenya is in talks with the World Bank for a $750 million budget support loan, the National Treasury CS, Njuguna Ndung’u, said on Tuesday, to help cover its funding needs for the financial year to the end of next June.
Without specifying the dollar amount, CS Njuguna Ndung’u stated last month that Kenya was discussing with the World financer for additional finance.
“The proposed package under discussion with the World Bank aims at promoting sustainable, resilient and inclusive growth,” Ndung’u said in a speech at a World Bank event on Tuesday.
President William Ruto, who took office in the middle of September, is looking for less expensive loans after his predecessor’s debt-fueled infrastructure construction drive left the nation with high-interest commercial debt.
According to the finance CS Njuguna Ndung’u, the type of loan discussed with the World financer is a Development Policy Operations loan, often connected to a pre-established policy area.
In 2019, Kenya met the criteria for that kind of funding, and it has since gotten four of them, the most recent of which was in March when the World Bank provided the loan on concessional terms, making it significantly lower than commercial loans. The total annual interest cost of the Kenya DPO is approximately 3.0%.
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