A mind-boggling deal? Kenya secures a jaw-dropping $3 billion loan from Afreximbank to tackle trade and climate change.
In a stunning turn of events, Kenya’s government has signed a bewildering US$3 billion Country Programme with the African Export-Import Bank [Afreximbank] in an effort to prop up its faltering economy. This deeply complex memorandum establishes a framework for the implementation of their Country Programme, which is set to last three years and will funnel funds towards both private and public sectors related to trade. Multiple financing instruments, including loans, guarantee facilities, trade services, investment banking, and advisory services will be employed to achieve this goal. What’s more, Kenya will be the fortunate recipient of the recently introduced Climate Change Adaptation Facility, courtesy of Afreximbank. The eagerly awaited US$800 million Kenya Climate Change Adaptation Facility (KCCAF) will effectively enable the nation to develop 200 irrigation schemes under a brand new public-private partnership framework with budget and sovereign-debt-neutral structures. So if you thought everything was going to stay the same, think again! Afreximbank will also be lending its support towards Kenya’s export-led development agenda by financing the operationalization and development of Special Industrial Zones in an effort to bolster the country’s manufacturing industry. Perhaps most impressively, funds that are committed by Afreximbank under the Country Programme will be dedicated to upgrading existing infrastructure and developing modern infrastructure and facilities throughout Kenya. Finally, by providing further lines of credit and a host of other products to Kenyan banks, Afreximbank is able to support the development of a more diversified and expansive banking industry within Kenya, which ultimately benefits the local economy. Speaking at the signing ceremony, President William Ruto outlined how the programme will help Kenya recover from the economic crisis brought on by the COVID-19 pandemic and ease the impact of the ongoing Ukraine Crisis. And if you thought the surprises ended there, think again. The government has committed to building supporting infrastructure and offering opportunities to tackle the scourge of youth unemployment in SEZs, while stage two of the hustler fund is set to be launched soon in support of Kenya’s SME ecosystem. With the Country Programme’s promise of fostering growth and stimulating agriculture, industrial growth, and regional and intra-African trade, the sky’s the limit for Kenya’s future economic prosperity.
