World Bank grants Kenya another Ksh.75 billion loan

The World Bank has approved a Ksh.75 billion loan to Kenya for budgetary support.

This is the first time in years the World Bank is putting cash straight into the National Treasury to be used at the discretion of the government.

In a statement issued on Wednesday, the World Bank said it has lend the money to support the government’s Big Four agenda which prioritizes food security, affordable housing, universal health coverage, and manufacturing.

The loan approval comes even after central bank governor Dr. Patrick Njoroge warned that the country has reached its debt limit.

The country’s debt has hit Ksh.5.5 trillion, which represents a debt service ratio of 33.4% instead of the recommended global average of 30%.

Still this month, Kenya successfully issued a third Eurobond priced at Ksh.210 billion (USD 2.1 billion)  despite rising concern over its ability to service its debt burden.

Treasury CS Rotich, in a statement, said the Ksh.210 billion raised will be used to finance the budget and repay a Ksh.75 billion 2014 Eurobond that is due to mature in June.