The International Monetary Fund Kenya Representative, Jan Mikkelsen has said that the IMF assessors are to meet the Kenyan Treasury officials next week to discuss the 3-year standby credit facility and arrangement worth $1.5 billion that expires in March 2018.
Statistics from the Central Bank of Kenya show that the country’s debt had increased to 4.4 trillion shillings in September 2017 up from 3.08 trillion shillings in November 2015, a higher percentage from less than half a trillion in 2014.
The government through the Treasury Permanent Secretary Henry Rotich had stated its desire to reduce the budget deficit to 6 percent in its Budget Policy Statement (BPS.) This is to be done through budget cuts which are to start in July 2018 which is the next financial year.
“We believe that the fiscal deficit is too high and, therefore, also debt accumulation has been too fast and don’t think that targeted deficit of about eight and nine percent is sustainable,” IMF country representative Jan Mikkelsen said.
The $ 1.5 billion standby credit which was to cushion the government from unforeseen shocks will be reviewed during the meeting.