Kenya Sees Agreement on IMF Standby Loan Facility After Meeting

NAIROBI (Capital Markets in Africa) – Kenya said it’s almost reached an agreement with the International Monetary Fund on a new standby loan facility after a meeting this week in the East Africa nation’s capital, Nairobi.

A similar facility, where the IMF availed $1.5 billion for Kenya to draw from in the event of balance of payment shocks, but didn’t, lapsed in September. The insurance-type facility will serve to reassure buyers of Kenyan debt such as $2 billion that the government plans to raise through eurobonds by June.

“We are more or less in agreement on the facility,” Geoffrey Mwau, director general for budget, fiscal and economic affairs at the National Treasury, said Friday in an interview. It’s important regardless of whether the government issues foreign debt or not, and “we need to have it,” Mwau said.

The IMF’s representative in Kenya, Jan Mikkelsen, said last month that the fund discussions on a new fund-supported program were continuing. He, like Mwau, declined to disclose the proposed size for the facility, or when an agreement might be reached.

 Source: Bloomberg Business News