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Kenya is about to complete her next line of credit from the International Monetary Fund (IMF). Kenya’s Finance Minister, Henry Rotich says the transaction could be completed in two months since the initial bottleneck of removing interest rate hike would have been done with.
East Africa’s largest economy is seeking another credit facility since its previous 1.5 billion U.S. dollars ended last year. According to Rotich, “Kenya is looking at a similar arrangement as we had before”, making reference to the sale of a $2.1 billion sovereign Eurobond.
The IMF agreed with the Kenyan Minister that private sector credit growth has been slow since the government capped commercial lending rates at four percent above the central bank rate in 2016 as banks are not lending money out.
Rotich says policymakers in Nairobi wanted to make sure the cap does not constrain credit to small and medium enterprises and that discussions were being held to either amend or suspend it.
