(Bloomberg) -- The International Monetary Fund plans to disburse additional financing to Kenya after completing an ongoing review of the nation’s program signed in 2021.

A staff team is currently in Nairobi to assess Kenya’s performance under the $4.43 billion loan program, a spokesperson for the lender said in an emailed response to questions from Bloomberg.

The team “will undertake a full assessment of recent developments, including the implications of market access, and of program performance,” the IMF said, referring to Kenya’s new eurobond issuance in February to buy back debt maturing in June.

The expected IMF disbursement amount after this review is about $937 million under the  Extended Fund Facility and the Extended Credit Facility,  according to the lender’s January staff report. Kenya is also expected to receive a further $59 million from the so-called Resilience and Sustainability Trust to bolster the nation’s defenses against climate change.

Inflows from the IMF, along with $1.2 billion expected from the World Bank, are seen boosting the nation’s foreign reserves and provide budget financing support. 

IMF’s mission team met with Kenya’s Finance minister Njuguna Ndung’u on Tuesday, the nation’s Treasury said via X.

Kenya is at high risk of debt distress and reducing debt vulnerabilities is a central objective of the IMF-supported program. A fiscal consolidation plan backed by the lender targets a budget deficit of 3.9% of gross domestic product for the year through June 2025 and 3.3% for both 2025-26 and 2026-27.

The funds will help boost the nation’s coffers as it faces a Eurobond maturity, as well as arrears to contractors and suppliers, amid missing revenue targets.

Cumulative disbursements under the program reached $2.6 billion after a payment in January.

Kenya needs to settle a balance of $557 million of its 2024 notes after the nation managed to avoid a default via a new eurobond issue in February.

 

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