Kenya’s Debt Crisis: William Ruto’s Administration to Consult IMF on New Loan Programme

• The National Treasury under Minister John Mbadi will hold new talks with the International Monetary Fund (IMF) regarding a new loan program
• This comes after the international lender terminated the agreement reached in 2021 after Kenya failed to meet several conditions
• During the last visit to Nairobi, IMF officials assessed the state of the country’s economy and discussed plans and policies for the future, including the need for a new program

Presidential Administration William Ruto is expected to involve the International Monetary Fund (IMF) in a new funding program.

The new visit by the fund’s staff will take place in February after the international lender played hardball for months after ending the multi-year plan in March 2025.

When will the Treasury sit with the IMF?

There is still hope that Kenya can get a new IMF-financed program due to the Treasury’s confirmation of new negotiations.

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The agreement will be important for ensuring a strong financial reform framework to stabilize debt sustainability.

“Before the end of next month (February 2026), the IMF is likely to return to the country to continue discussions,” Raphael Owino, director general of the Public Debt Management Office of the National Treasury, told Business Daily.

However, Owino did not explain why the staff visit, which was originally scheduled for January 2026, was postponed.

To manage expectations about the outcome of ongoing negotiations that began in late 2025, Daily Nation reported that Kenya expects to receive additional funds from the IMF but has not included them in the budget for the next financial years.

Why did the IMF play for Kenya?

The IMF ended the multi-year agreement reached in 2021 and deprived Kenya of funding of 850.9 million dollars (KSh 109.7 billion).

This happened due to Kenya’s failure to fulfill agreed conditions, such as restructuring Kenya Airways (KQ) and the absence of restrictions on the use of funds from the oil stability fund that were allegedly misused.

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Overall, Nairobi failed to meet 11 out of 16 conditions, which included reducing spending, increasing tax revenue, and paying suppliers.

Kenya is also trying to get funding from the World Bank’s Development Policy Operation (DPO), but has failed to meet 11 conditions.

These include online government procurement, a system for quick approval of County Government Supplementary Appropriation Bills, and additional implementation of the Single Treasury Account.

During its last visit to Kenya, which ran from September 25 to October 9, 2025, the IMF assessed the state of the country’s economy and discussed plans and policies for the future, including the need for new programs.

During the visit, the fund reaffirmed its long-term commitment to Kenya’s economic development.

What is Kenya’s debt?

Kenya’s public debt stood at KSh 12.25 trillion in November 2025, according to the Central Bank of Kenya.

Following the IMF’s rejection of a new loan, the National Treasury is set to borrow KSh 906 billion from the domestic market in the 2026/2027 financial year.

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Source: TUKO.co.ke