Kenya: Fifth Reviews Under the Extended Fund Facility and Extended Credit Facility Arrangements and Request for a 20-Month Arrangement Under the Resilience and Sustainability Facility, Requests for Extension, Rephasing, and Augmentation of Access, Modification of a Performance Criterion, Waiver of Applicability for Performance Criteria and Waiver of Nonobservance for a Performance Criterion, and Monetary Policy Consultation Clause-Press Release; Staff Report; and Statement by the Executive Director for Kenya

IMF Staff Country Reports, July 19, 2023

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Canonical URL: Kenya: Fifth Reviews Under the Extended Fund Facility and Extended Credit Facility Arrangements and Request for a 20-Month Arrangement Under the Resilience and Sustainability Facility, Requests for Extension, Rephasing, and Augmentation of Access, Modification of a Performance Criterion, Waiver of Applicability for Performance Criteria and Waiver of Nonobservance for a Performance Criterion, and Monetary Policy Consultation Clause-Press Release; Staff Report; and Statement by the Executive Director for Kenya

Presents Kenya’s Fifth Reviews under the Extended Fund Facility and Extended Credit Facility Arrangements and Request for a 20-month Arrangement under the Resilience and Sustainability Facility (RSF).
Also includes requests for extension, rephasing, and augmentation of access; modification of a performance criterion; waiver of applicability for performance criteria; waiver of nonobservance for a performance criterion; and a monetary policy consultation clause.
Key program priority: reducing debt vulnerabilities through multi-year fiscal consolidation efforts.

Core fiscal strategy: raise tax revenues and rationalize spending while protecting priority social and developmental spending.
Objective: reduce debt vulnerabilities through sustained multi-year consolidation.

Policy prescription: maintain a proactive monetary policy stance as part of a mutually reinforcing prudent set of policies.

RSF reforms expected to advance Kenya’s record on addressing climate-related challenges.
Specific reform areas:
- Incorporate climate risks into fiscal planning and the investment framework.
- Reduce emissions through carbon pricing.
- Enhance Kenya’s existing frameworks to mobilize climate finance.
- Strengthen disaster risk reduction and management.

Subjects: Climate change; Climate finance; Debt sustainability analysis; Environment; External debt; International organization; Monetary policy; Public debt.
Keywords: Africa; agriculture Project; apportionment ratio; authorities' effort; Climate change; Climate finance; Debt sustainability analysis; East Africa; Global; inflation expectation; Kenyan authorities; Sub-Saharan Africa; tax package; tax shortfall; trade tax.