To further show the dwindling economic fortunes of the country under President Uhuru Kenyatta, this week saw the forceful re-entry of the global ‘lender of last resort’, IMF, with Managing Director Christine Lagarde holding a high-level meeting with President Uhuru Kenyatta at State House.
During the State house meeting, President Uhuru requested an Emergency loan to Kenya.
“We remain vulnerable to future shocks and we must be able to effectively deal with them if and when they arise….My country needs an insurance-type facility that can be accessed as and when needed with sufficient resources to effectively deal with potential shocks,” Kenyatta said.
However, economic analysts are suspicious of the return of IMF as a major economic partner of Kenya and now warning Uhuru to be cautious.
“The IMF approach to central banking unfortunately has little regard for economic growth or employment generation; instead, it promotes formal ‘inflation-targeting’, in which keeping a low rate of inflation; in the low single digits, is an obsession and is the dominant target of monetary policy,” writes Mohammed Wehliye in Business Daily.
“IMF help should be sought only when necessary as Kibaki did. After all, the IMF is a lender of last, not first resort. We don’t want to return to the days when the fund literally ran the economic affairs of this nation to the detriment of its citizens,” adds Wehliye.
At the same time, it is now emerging the Uhuru’s loan request will delay until March after IMFÂ has assessed the country’s past economic performance as well as proposed policies in an upcoming Article IV meeting in March.