Kenya is set to receive Sh19.8 billion ($170 million) loans from the African Development Bank (AfDB) this year.
The loan is meant for budgetary support and agriculture to help the economy recover from the effects of the Covid-19 pandemic and the Russia-Ukraine conflict.
Nnenna Lily Nwabufo, AfDB director-general for East Africa, said the amount Sh11.66billion ($100 million) would go towards budget support to help steer the Kenyan economy back on track amid inflationary pressure while the other $ 70 million will go to support for agriculture.
“We shall provide $100 million budget support to Kenya for this year to help rebuild. There will also another $70million support for fertiliser and seeds since the Russia-Ukraine crisis has heavily affected the agri-based economy.” Nnenna Lily Nwabufo, AfDB director-general for East Africa, as quoted by Business Daily.
The loan is also meant to finance the electricity sector and the public-private-partnership reforms to strengthen the cornerstone utility (Kenya Power), place Kenya on an efficient, green energy path and boost private infrastructure investment.
This comes at a time when Kenya’s debts towards China-funded infrastructure projects have increased by a record KSh 73.48 billion amid an increased clearance of principal sums, placing the country’s debt to China at KSh 1.4 trillion.
According to the expenditure data published by the Treasury, the amount of money paid to Chinese lenders increased by 135.15 per cent compared with KSh 31.25 billion in June 2021.
However, a report tabled in Parliament two weeks ago by the Treasury Cabinet Secretary Ukur Yatani showed that the State borrowed nine new loans between January and April, totalling Sh137.93 billion to finance projects.
Six of the new loans are from multilateral lenders and three from bilateral lenders and were contracted between January 1 and April 30.