IMF GETS NOD
…Kenyan MPs agree to tough conditions with new budget directives
NAIROBI - Members of Parliament have agreed to some of the tough conditions set by the International Monetary Fund (IMF) including the scrapping of tax breaks and exemptions.
In a report by the Budget and Appropriations Committee on the Budget Policy Statement for 2021-22 and the Medium Term Debt Management Strategy, the lawmakers also asked the National Treasury to expedite restructuring of highly indebted State corporations, a condition that had earlier been issued by the IMF for the country’s access to a Sh262 billion facility.
“The National Treasury should restructure Stateowned enterprises (SoEs), especially the highly indebted ones who are unable to meet their operational costs, with a view to privatising some of them by end of 2021-22 financial year to put them on a sound economic footing,” said the committee chaired by Kieni MP Kanini Kega.
The committee also asked Treasury to defer new projects by one year until funding is available. Funds should also be provided for stalled projects before finalisation of budget estimates for 2021-22.
Treasury is also required to take into account the pending bills and ensure that they are adequately provided for within the approved expenditure ceilings.
Most of the changes had been captured by the National Treasury in the Budget Policy Statement. However, IMF had earlier on pronounced itself on them.
Last month, the IMF approved the crucial credit facility for Kenya under a three-year programme.
Previously, the country had a precautionary credit arrangement with the IMF, which ended after Kenya flouted some of the conditions, including failure to keep its debt low.
– THE STANDARD, Kenya.