Kenya will have to implement tough conditions imposed by the International Monetary Fund following the approval of a new multibillion-shilling loan.
The lender has demanded that all public servants declare their wealth and that the cash-strapped government makes public the ownership details of all companies that are awarded public tenders as a way of curbing rampant theft of taxpayers’ funds.
In a statement announcing the approval of a $2.34 billion (about Sh257 billion) loan to Kenya on Tuesday, the IMF has also singled out nine key loss-making parastatals that will undergo a major overhaul to stop bleeding the public purse.
The statement comes amid a public outcry over the government’s growing appetite for new loans amid runaway corruption in the public sector. It spells out governance conditionalities and timelines that must be met within the three-year loan maturity.
"Key pillars of the agenda include the promotion of fiscal transparency via publishing procurement information including beneficial ownership data of companies awarded contracts; operationalising the Access to Information Act; review of the current legal framework for asset declarations of senior public officials and conflict of interest rules; and, given that corruption is inextricably intertwined with the need to launder its proceeds, an effective implementation of AML/CFT (anti-money laundering) measures," states the IMF document.
The conditions are not entirely new and some of the measures being demanded are actually already in place to some extent, but the multilateral lender wants more specific action and implementation timelines than the Kenyan government has been committed to enforce.
"Concrete measures will include completing a draft blueprint that will identify necessary actions and legal reforms to enhance governance (by July 2021 supported by IMF); developing an integrated monitoring and reporting system (by September 2021); establishing a performance management monitoring and evaluation framework; and initiating a review of institutional structures," sates the IMF.
The statement was released on a day when an online petition asking the IMF to withhold the latest loan until the cash-strapped government addressed runaway corruption recorded more than 200,000 signatures.
The conditions could usher in a fresh round of job cuts in the public service and tax hikes, similar to what happened with the Structural Adjustment Programmes of the 1980s.
The public debt load has already exceeded Sh7.2 trillion, equivalent to nearly two thirds (65.6 per cent) of the gross domestic product (GDP).
The Treasury is already petitioning Parliamentary to increase the statutory debt limit of Sh9 trillion, arguing that the ceiling will […]