Kenya has made request to international financial institutions for emergency funding to the tune of 115 billion shillings to support healthcare system and budget.
Central Bank of Kenya Governor Dr Patrick Njoroge says the first funding to help in containing Coronavirus spread is expected by end of April.
However, borrowers should not expect immediate adjustments in lending rates even after Monday’s rate cut by the Monetary Policy Committee.
The governor says going forward, policy action will focus on three areas; strengthening of the healthcare system, protection of affected workers and business and those that will support recovery.
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With suppressed economic activities which has chocked revenue the government has turned to Bretton woods institutions for budgetary funding.
A request amounting to Kshs 5 billion in emergency to combat Covid-19 has been submitted to the World Bank.
Additional CBK has made a request to the World Bank and IMF for emergency assistance to the tune of Kshs 110 billion shillings for budgetary support.
According to CBK, the current account deficit is projected at 4 to 4.6 per cent of the gross domestic product this year, but the outcome will depend on the duration and intensity of the pandemic.
Economic experts project the account to widen further as the demand for export like coffee, tea, and horticulture falls.
Already the tourism industry is feeling the impact with thousands of hotel and flights cancellations.
The governor through an online briefing also said they are working with other relevant stakeholders to outline an emergency stimulus package to support the economy.
The bank has also lowered the cash reserve ratio for banks to 4.25 percent, in a bid to release 35 billion shillings to the economy.
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