News / Africa

IMF Director Lagarde Warns of Looming Shocks in Kenya

IMF's Christine Lagarde addressed Kenya's economic issues at the nation's parliament. (IMF photo by Stephen Jaffe)
IMF's Christine Lagarde addressed Kenya's economic issues at the nation's parliament. (IMF photo by Stephen Jaffe)
Reuben Kyama
The International Monetary Fund's Christine Lagarde this week urged Kenya to decentralize management and fiscal powers to address large infrastructure gaps and take the lead in regional economic integration.

As the managing director of the the International Monetary Fund (IMF), Lagarde spoke to a group of investors, diplomats and civil society organizations at several venues including Kenya's parliament in Nairobi.

Lagarde said Kenya stands a good chance to lift the region economically if it goes ahead with its reform agenda.

She commended the country’s ambitions, but warned about pitfalls in the coming years.

She said this East African nation of 40 million-plus people is vulnerable to global economic forces – particularly a slowdown in emerging markets, which once bolstered the region’s growth.

Remarkable economic gains praised

“Indeed, Kenya’s economic gains over the past few years have been nothing short of remarkable,” said Lagarde. “Coming on the heels of a delicate political transition, growth remains robus – at more than 5 percent in 2013.

“And a set of bold economic reforms have laid the foundations to lift the economy to middle-income status within the next decade – if Kenya maintains the reform momentum.”
 
The IMF has predicted that sub-Saharan Africa will grow at a rate of nearly 6 percent in 2014. Kenya grew by 5 percent in 2013.  

The IMF chief, who was on a three-day official visit to Kenya this week, underlined the Bretton Wood institution’s commitment to East Africa’s  leading economy.
 
We have been by Kenya’s side through the many challenges you have faced” said the IMF chief. “We were here during the 2009 global downturn, during the 2011 drought, and we stood with you during the Westgate attack…

“We have provided financial support through our Extended Credit Facility to deal with adverse shocks – and I am very happy that our executive board gave its seal of approval for the successful completion of the program just a few weeks ago.

Lagarde notes constant support

“We have also worked with the Kenyan government as it designed and implemented reforms, and we supported that agenda with financing, advice, and stepped-up technical assistance.

“What I am saying is that the IMF has been Kenya’s partner – through thick and thin.”
 
While in Kenya, Lagarde met with Kenyan President Uhuru Kenyatta, treasury officials, women leaders and representatives from the business community.

Kenyan officials are seeking an emergency loan from the Washington-based lenders to use it as a fall back to looming economic shocks. They say the loan, which the IMF is to disburse as a lender of last resort, will be priced on commercial terms – signalling its possible impact on Kenya’s external debt burden.

But the IMF boss advised Kenyan officials to promote fiscal discipline and encourage foreign investment in order to maintain the country’s high economic growth rate, and contribute to sub-Saharan development.

Giving Kenya the credit

“But let me be clear on this point: Kenya’s achievements are Kenya’s. Your country has had full ownership of the reform agenda. You have implemented it. You have garnered domestic support for it. And that is why it was a success.

“Now is a good time to commend Kenya on its performance. But this is not the time for complacency.

“Yes, Kenya’s future holds great promise. Looking ahead, achievements need to be deepened and broadened, so the economy can be made even more resilient, and the benefits of growth can be even more widely shared among all the Kenyan people.”

The decision by Kenya’s treasury officials to turn to the precautionary lending arrangement is one of the measures the Kenyatta government is taking to prevent a recurrence of the shocks that hit the economy in 2011 after the Central Bank of Kenya failed to adequately respond to the combination of internal and external shocks.

You May Like

Photogallery Americans Celebrate Thanksgiving With Feasts, Festivities

Holiday traditions include turkey dinners, 'turkey trots,' American-style football and New York parade with giant balloons More

Video For Obama, Ferguson Violence is a Personal Issue

With two years left in term, analysts say, president has less to lose by taking conversation on race further More

Video Italian Espresso Expands Into Space

When Italian astronaut Samantha Cristoforetti headed for the ISS, her countrymen worried how she would survive six months drinking only instant coffee More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
South Africa Sees Male Circumcision as Way to Reduce HIV Infectionsi
X
November 28, 2014 3:31 PM
South Africa remains plagued by AIDS despite massive government and NGO efforts on prevention and life-sustaining Anti-Retro-Viral programs. But the country has opened up another front to reduce new HIV infections: promoting circumcision. Emilie Iob reports for VOA News from a pioneering circumcision center in Orange Farm, Johannesburg.
Video

Video South Africa Sees Male Circumcision as Way to Reduce HIV Infections

South Africa remains plagued by AIDS despite massive government and NGO efforts on prevention and life-sustaining Anti-Retro-Viral programs. But the country has opened up another front to reduce new HIV infections: promoting circumcision. Emilie Iob reports for VOA News from a pioneering circumcision center in Orange Farm, Johannesburg.
Video

Video To Make A Living, Nairobi Street Vendors Face Legal Hurdles, Physical Violence

The Nairobi City Council has been accused of brutality in dealing with hawkers in the Central Business District - in order to stop them from illegally selling their wares on the streets. Lenny Ruvaga has more for VOA News from the Kenyan capital.
Video

Video For Obama, Ferguson Violence is a Personal Issue

Throughout the crisis in Ferguson, Missouri, President Barack Obama has urged calm, restraint and respect for the rule of law. But the events in Ferguson have prompted him to call — more openly than he has before — for profound changes to end the racism and distrust that he believes still exists between whites and blacks in the United States. VOA White House correspondent Luis Ramirez reports.
Video

Video Online Magazine Gets Kids Discussing Big Questions

Teen culture in America is often criticized for being superficial. But an online magazine has been encouraging some teenagers to explore deeper issues, and rewarding their efforts. VOA religion reporter Jerome Socolovsky went to this year’s Kidspirit awards ceremony in New York.
Video

Video US Community Kicks Off Thanksgiving With Parade

Thursday is Thanksgiving in the United States, a holiday whose roots go back to the country's earliest days as a British colony. One way Americans celebrate the occasion is with parades. Anush Avetisyan takes us to one such event on the day before Thanksgiving near Washington, where a community's diversity is on display. Joy Wagner narrates
Video

Video Aung San Suu Kyi: Myanmar Opposition to Keep Pushing for Constitutional Change

Myanmar opposition leader Aung San Suu Kyi says she and her supporters will continue pushing to amend a constitutional clause that bars her from running for president next year. VOA's Than Lwin Htun reports from the capital Naypyitaw in this report narrated by Colin Lovett.
Video

Video Mali Attempts to Shut Down Ebola Transmission Chain

Senegal and Nigeria were able to stop small Ebola outbreaks by closely monitoring those who had contact with the sick person and quickly isolating anyone with symptoms. Mali is now scrambling to do the same. VOA’s Anne Look reports from Mali on what the country is doing to shut down the chain of transmission.
Video

Video Ukraine Marks Anniversary of Deadly 1930s Famine

During a commemoration for millions who died of starvation in Ukraine in the early 1930s, President Petro Poroshenko lashed out at Soviet-era totalitarianism for causing the deaths and accused today’s Russian-backed rebels in the east of using similar tactics. VOA’s Daniel Shearf reports from Kyiv.
Video

Video Hong Kong Protests at a Crossroads

New public opinion polls in Hong Kong indicate declining support for pro-democracy demonstrations after weeks of street protests. VOA’s Bill Ide in Guangzhou and Pros Laput in Hong Kong spoke with protesters and observers about whether demonstrators have been too aggressive in pushing for change.
Video

Video US Immigration Relief Imminent for Mixed-Status Families

Tens of thousands of undocumented immigrants in the Washington, D.C., area may benefit from a controversial presidential order announced this week. It's not a path to citizenship, as some activists hoped. But it will allow more immigrants who arrived as children or who have citizen children, to avoid deportation and work legally. VOA's Victoria Macchi talks with one young man who benefited from an earlier presidential order, and whose parents may now benefit after years of living in fear.
Video

Video New Skateboard Defies Gravity

A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video Falling Gas Prices Impact US Oil Extraction

With the price of oil now less than $80 a barrel, motorists throughout the United States are benefiting from gas prices below $3 a gallon. But as VOA’s Kane Farabaugh reports, the decreasing price of petroleum has a downside for the hydraulic fracturing industry in the United States.

All About America

AppleAndroid