(Bloomberg) -- Kenya may need to find alternative sources to finance its current budget due to a delay by the International Monetary Fund in issuing it with a 28 billion shilling loan ($238 million).

The funding is part of a $2.34 billion extended credit facility and extended fund facility that was agreed to by the IMF more than year ago for budget support. The loan needs board approval after a staff-level agreement with the lender was reached in April. 

The board is only expected to meet in “coming weeks” to give final approval, a spokesman for the lender said in an emailed response to questions, without explaining the reason for the delay. 

Kenya had included the loan in its net external financing requirement of 280.7 billion shillings for the fiscal year ending this month, and the delay is likely to place further pressure on the nation to find budget funding. Earlier this month it halted plans to sell Eurobonds in 2022 because of a surge in yields that have made issuances too expensive and said it will seek to borrow about $1 billion from banks by the end of June instead. Its $2 billion notes maturing in June 2024 are trading at distressed levels.   

Central bankers have been unleashing what may prove to be the most aggressive tightening of monetary policy since the 1980s to curb high inflation, fanned by choked supply chains, historic stimulus packages and Russia’s invasion of Ukraine. That’s caused a flight of capital from riskier and heavily indebted nations, increasing the cost of Eurobond issuances to fund budget shortfalls. 

“The modest delay in the timing of the anticipated IMF financing could be mitigated by securing alternative source of financing,” the IMF spokesman said. 

Treasury Secretary Ukur Yatani and Principal Secretary Julius Muia did not answer calls or respond to messages to their mobile phones for comment. 

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