Efforts to secure a fresh lending arrangement between Kenya and the International Monetary Fund (IMF) have reached a standstill, according to the country’s finance minister.
At a press briefing, John Mbadi explained that the standoff stems from differing views about how certain debts should be categorized.
Mbadi noted that the IMF wants loans tied to infrastructure projects, particularly securitized loans to be labeled as sovereign debt, a classification Nairobi strongly opposes.
He added that discussions will continue in the hope of resolving the issue, although he did not indicate when the next meeting will take place.
Kenya is pushing for another bailout from the IMF after the previous $3.6 billion agreement ended in April.The government is also planning to raise $1.3 billion through a bond issuance later this month.
In October, Kenya successfully renegotiated its $5 billion loan from China, used to construct a modern railway, reducing interest pressure and saving the Treasury millions.
Treasury reports show that as of the end of March, Kenya’s external debt stood at $40.5 billion. Out of this amount, $14.4 billion is owed to the World Bank, $7.52 billion to eurobond holders, and nearly $5.04 billion to China.check
