By Joshua Khisa 

Kenya is poised to secure yet another financial support from the International Monetary Fund (IMF).

IMF on Thursday announced that it had reached a staff-level agreement with Kenya to expand its financing to the country by $938 million.

This is an equivalent of about Ksh142.6 billion (based on the current exchange rate).

However, the agreement is subject to IMF management approval and consideration by the Executive Board, which is expected in January 2024.

“I am pleased to announce that the IMF team and the Kenyan authorities have reached staff-level agreement on (i) the sixth reviews of Kenya’s economic program under the Extended Fund Facility (EFF) and Extended Credit Facility (ECF) arrangements; (ii) an augmentation of access under the EFF/ECF totaling 130.3 percent of quota SDR 707.3 million, about US$938 million); and (iii) the first review of the RSF,” the Washington based agency said in a statement it’s website.

“Upon completion of the sixth reviews by the IMF Executive Board, Kenya would have immediate access to SDR 514.48 million (about US$682.3 million), including from the augmentation of access under the EFF/ECF arrangements (SDR469.25 million) and first review of RSF (SDR45.23 million),” it added.

The additional loan would bring total IMF financial support disbursed under the EFF/ECF and RSF arrangements to SDR2.02 billion (about US$2.68 billion).

While announcing the latest developments, IMF hailed some of the measures that Kenya has taken amid the tightening global financing conditions for frontier economies and global geopolitical tensions.

“The authorities’ strong reform program aims to enhance macroeconomic stability and restore confidence to ensure access to the international bond markets,” it said.

In addition, the global leader noted that Kenya’s economy has displayed resilience, with real GDP expanding by 5.4 percent in the first half of 2023, primarily due to a robust recovery in the agriculture sector following the return of rains.

However, it pointed out that despite Kenya’s continued commitment to the implementation of the IMF-supported economic program which is broadly on track, uncertainty looms over the country’s effective access to international bond markets.

“This uncertainty is exerting substantial pressure on liquidity, primarily due to the sizeable Eurobond maturing in 2024,” IMF said.

“Against this backdrop, the authorities are actively mobilizing additional financing from their development partners, the IMF, and commercial sources while concurrently intensifying their efforts to enhance macroeconomic policies and implement structural reforms,” if added.