Kenya is in talks with the World Bank and the African Development Bank (AfDB) to secure additional financing for its budget, according to Central Bank Governor Kamau Thugge.
The discussions are aimed at securing external funding during the current financial year. The government is considering different financing options, including support from the World Bank and a possible debt-for-food arrangement.
Thugge said the financing could become available between now and June 2027.
Kenya is also expected to receive about $400 million in emergency financing from the World Bank to help address challenges linked to health and climate risks.
The country is seeking additional funding as it balances public spending needs with the cost of borrowing. Access to concessional financing could help reduce its reliance on more expensive domestic loans.
The central bank is also monitoring inflation risks linked to higher fuel prices and global economic uncertainty. At the same time, lower food prices could help ease some pressure on consumers.
The discussions show the financial challenges facing governments across Africa as they seek funds for development while managing debt obligations.
Monafrika’s Take
External financing can help governments support essential services and development, but borrowing must be carefully managed. Kenya should ensure that any new funds support productive projects and deliver clear benefits to citizens. African countries also need stronger local revenue systems and growing private sectors to reduce dependence on borrowing.
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