IMF staff to visit Kenya for talks on potential support programme
“An IMF staff team will begin initial discussions in the coming days on possibble Fund-supported programme,” said Haimanot Teferra, the IMF’s mission chief for Kenya.
The International Monetary Fund (IMF) announced on Wednesday that a team of its staff will visit Kenya from September 25 to October 9 to begin talks with the government on a potential IMF-backed financial programme.
The visit comes as Kenya faces mounting debt repayment pressures and seeks to secure a new financing deal after its previous $3.6 billion arrangement with the IMF expired in April. The earlier programme, launched in 2021, included an Extended Fund Facility (EFF) and Extended Credit Facility (ECF) but ended without disbursing the final tranche of $800 million.
Kenyan officials, including Central Bank Governor Kamau Thugge, have openly expressed interest in a fresh IMF programme that would provide new lending support. Analysts say this would help Kenya manage its external debt repayments, which have become a key concern for investors and rating agencies.
Markets react positively to IMF talks
Following the IMF’s announcement, Kenya’s dollar-denominated bonds saw an immediate boost. The country’s 2048 Eurobond rose 0.7 cents to trade at 89.88 cents on the dollar, according to data from Tradeweb. Financial experts say the market reaction signals growing confidence that Kenya may soon secure external support to stabilize its finances.
Fiscal challenges and public pushback
Kenya’s previous IMF-backed programme aimed to reduce the fiscal deficit, strengthen revenue collection, and implement structural reforms. However, the plan faced significant domestic resistance after the government introduced new tax measures to boost revenue. These tax hikes sparked deadly nationwide protests, forcing the government to roll back several proposals.
The inability to fully implement the agreed reforms ultimately led to the cancellation of the final programme review in March 2025, leaving Kenya without the last disbursement of $800 million.
IMF Signals Ongoing Support
Despite these setbacks, the IMF says it remains committed to helping Kenya address its economic vulnerabilities.
Kenya’s government is now under pressure to negotiate a credible fiscal plan that balances economic recovery with debt management. A successful deal with the IMF could unlock new funding, restore investor confidence, and help Nairobi avoid a potential liquidity crunch as major Eurobond repayments loom in the coming years.
The upcoming talks will be closely watched by global investors and regional economies, given Kenya’s role as East Africa’s largest economy and financial hub.
