Kenya Engages IMF for New Lending Programme Amid Debt Challenges

Kenya is set to negotiate a new lending agreement with the International Monetary Fund, replacing its current programme, to manage rising debt issues. The IMF mission chief confirmed the request at the end of a Nairobi visit, as Kenya seeks to stabilize its economy amid debt-service pressures.

Kenya and the International Monetary Fund (IMF) are in talks for a new lending programme, setting aside the existing one as the country deals with escalating debt obligations. The move comes after years of extensive government spending that have led to increased debt servicing costs.

Haimanot Teferra, IMF's mission chief, announced that a formal request has been received from Kenyan authorities, with plans to collaborate further. The ninth review of the current Extended Fund Facility (EFF) and Extended Credit Facility (ECF) programs will not continue.

The combined ECF/EFF programme, valued at $3.6 billion, is nearing expiration. Meanwhile, Finance Minister John Mbadi expressed intentions of pursuing a financing programme to manage Kenya's significant debt-to-GDP ratio, reported at 65.7% as of last June.

(With inputs from agencies.)