Jubilee begs World Bank $750m loan for affordable homes and agriculture

Kenya has requested the World bank loan of $750 million to fund affordable housing and small scale farmers across the Country.

There has been a question on why Kenya is taking too many loans especially from China which the Country isn’t in a position to repay.

Recently the Jubilee administration faced the wrath of Kenyans after the sale of the 3rd Euro board to facilitate the repayment of international loans.

The lender meets Tuesday to consider Kenya’s request for the loan, according to a person with knowledge of the matter. The person asked not to be identified because the matter is still private.

It’s the first proposed so-called Development Policy Financing to support Kenya’s reform program to “further enhance economic growth and make it more inclusive,” the lender said on its website.

Some of the funding is for two of the state’s so-called Big Four priorities – affordable housing and farmer incomes and food security – while the rest will “create fiscal space to allow the government to invest in key development programs, and crowd in private investment and leverage digitization to support the government’s inclusive-growth agenda,” the World Bank said.

If approved, the financing will be hot on the heels of $2.1 billion in Eurobonds that `Kenya raised earlier this month for infrastructure projects and to retire maturing debt. In the first quarter, the government borrowed 125 billion shillings ($1.23 billion) in a syndicated loan, as part of the 299 billion shillings of commercial debt it budgeted for the 2018-19 fiscal year.

Kenya’s public debt reached 5.42 trillion shillings in March, according to the central bank. The public and publicly guaranteed debt were 2.72 trillion shillings while domestic debt was 2.7 trillion shillings. By the end of last year, the government’s debt was 5.28 trillion shillings, equivalent to 52.7% of GDP, according to the National Treasury.

The international community had withdrawn funding to Kenyan projects due to rampant corruption cases involving the stealing of public money.

Philanthropist Bill Gates in 2017 said incidents of corruption in the health sector is “worrying” and may discourage donors.

He said he is always worried when such incidents are reported because even small amounts of money misused can dent donors’ confidence.

Gates was reacting to a question on the 2016 health scandal, where Kenya’s Health ministry could not account for Sh5 billion, which included donor funds. None of the foundation’s money was involved.

President Uhuru Kenyatta has underscored the government’s commitment to winning the war against corruption.

He warned corrupt individuals that the agency will stop at nothing in pursuit of a corruption-free nation.

“You can acquire dirty wealth but we shall come for you and we’ll make it very expensive because you’ll not have a retirement benefit from proceeds of corruption,” he cautioned.