Press Release No. 07/37

Press Release No. 07/37

The Executive Board of the International Monetary Fund (IMF) has approved the extension of the three-year Poverty Reduction and Growth Facility (PRGF) arrangement for Kenya by two months to April 30, 2007. Kenyan authorities requested the extension to continue the implementation of the economic program supporting the arrangement.

The PRGF arrangement, which was approved on November 21, 2003 (see Press Release No. 03/201), totals SDR 175 million (about US$263 million). It had been due to expire on November 20, 2006, but was then extended to February 28, 2007.

The PRGF is the IMF's concessional facility for low-income countries. PRGF-supported programs are based on country-owned poverty reduction strategies adopted in a participatory process involving civil society and development partners and articulated in a Poverty Reduction Strategy Paper (PRSP). This is intended to ensure that PRGF-supported programs are consistent with a comprehensive framework for macroeconomic, structural, and social policies to foster growth and reduce poverty. PRGF loans carry an annual interest rate of 0.5 percent and are repayable over 10 years with a 5 ½-year grace period on principal payments.