IMF Kenya Representative Jan Mikkelsen [Photo/Business Daily]
The International Monetary Fund (IMF) has warned Kenya over its rising debt and has called upon the government to stabilize the economy should there be 'unplanned shocks' in the future.
Kenya's IMF representative Jan Mikkelsen says despite the economies resilience during the electoral period the rising debt was still an issue and needed to be reviewed.
The countries public debt has been on the rise in recent years, rising to Sh4.4 trillion by the end of September from less than a trillion shilling in mid-2014.
According to Mikkelsen, Kenya needs to have clear policies so as to avoid debt vulnerability. This comes after the Finance Cabinet Secretary Henry Rotich mentioned a move to seek anothe syndicate loan and a second Eurobond.
“The fiscal deficit needs to be reduced a little bit to make more room for the private sector and also to reduce the public debt pressure. We still do see growth in the Kenyan economy quite resilient. It will of course assume that political stability returns to the country,” he said.
He added that the IMF intends to visit the country in December to review plans set out by the government.