IMF board to determine Kenya’s request for additional funding
The International Monetary Fund is optimistic that Kenya will achieve better economic growth despite poor quarter one results.
Visiting IMF Assistant Director for African Department Mauro Mecagni says that growth will be lifted by financial sector lending and the county government as well as the ongoing financial sector reforms.
Mecagni says Kenya’s request for additional funding will be determined by the IMF board later this year.
The jury is yet out on Kenya’s economic growth after quarter one growth for 2014 de-accelerated to 4.2 percent from 5.8 percent last year.
This has aroused a debate on whether Kenya will realize its projected 5.8 percent economic growth this year.
Mecagni says data from one quarter alone is not enough to warrant an immediate review of the projection. He says after a critical review of Kenya’s economic development, IMF is satisfied that the government has laid down sound mechanisms to boost growth this year and subsequent years.
The IMF mission has been in Kenya since 25th of last month, during which they held discussions with senior government officials.
The fund notes that considerable progress has been made during the first year of devolution through investments in infrastructure and social sectors.
However, it says that accountability needs to be improved in order to maximize returns from the devolved resources.
Mecagni says efforts to develop Nairobi into a regional hub for financial services have advanced with the strengthening of the Anti-Money Laundering/Combating the Financing of Terrorism framework and Kenya’s recent graduation from the Financial Action Task Force’s monitoring process.
The IMF conducts annual economic reviews of its member states through the Article IV Consultation, which, among other things, examines economic gains made by countries since the last review.