Press Release: Statement by IMF Managing Director Dominique Strauss-Kahn at the End of His Visit to Kenya
March 8, 2010Press Release No. 10/75
March 8, 2010
Mr. Dominique Strauss-Kahn, Managing Director of the International Monetary Fund (IMF), issued the following statement today in Nairobi at the conclusion of his visit to Kenya:
“I wish to thank President Kibaki, Prime Minister Odinga, Minister of Finance Kenyatta, Central Bank Governor Ndung'u, and other senior government officials for their warm hospitality and our fruitful discussions. I also had valuable exchanges with labor unions, civil society organizations, youth groups, and students here in Nairobi. This was also an opportunity for me to participate in a dialogue with Prime Minister Odinga, Deputy Prime Minister Kenyatta, Nobel Prize winner Wangari Maathai, Transparency International's Akere Muna, and Bob Geldof, on the challenges facing Africa in this post-crisis world. The depth of the discussion and the passion of the participants were very impressive.
“In my meetings with President Kibaki and Prime Minister Odinga, I welcomed Kenya's remarkable adjustment to a series of shocks that have affected its economy since 2008. Shortly after the country started to recover from the post-election violence, the economy was buffeted by rising world energy and fertilizer prices, a drought, the global economic recession, and more recently, another drought. As a result, economic growth slowed from 7.1 percent in 2007 to 2.7 percent in 2009. Fiscal and external current account deficits widened.
“The authorities' policy response to the crisis was appropriate and timely. The Kenyan authorities implemented good economic policies, and the IMF provided financial assistance to support these efforts and mitigate the adverse effects of these shocks. In June 2009, the Fund provided about US$200 million under the rapid access component of the Exogenous Shocks Facility (ESF). Later in the year, Kenya received about US$350 million through the general and special allocations of Special Drawing Rights (SDRs) to all IMF members. As a result of these combined efforts, a nascent recovery is taking place. Growth is projected to be about 3 percent in 2010 and to rise gradually to 6.5 percent over the medium term.
“We agreed that it will be important to continue sound economic policies to contain risks and place the economy on a robust growth path with sustainable debt levels and low inflation. Structural reforms will need to be stepped up to enhance the competitiveness of the economy, and attract investment needed to diversify the economy. To strengthen the financial sector further, it will be crucial to enact several pieces of legislation that are still pending, including the banking, new deposit insurance and importantly the anti-money laundering bills.
“Finally, I welcome the recent progress toward agreement on a draft constitution that we hope will establish political consensus in the country. In addition, the new constitution should provide a solid base for carrying forward key economic reforms.
“I look forward to continuing this constructive dialogue on economic policy and structural reforms, and to Kenya's continued progress in the future,” Mr. Strauss-Kahn said.