IMF Chief Calls Kenya ‘Innocent Bystander’ in World’s Debt Shock

The International Monetary Fund’s chief capped a visit to Kenya with an enthusiastic endorsement of its economic management and expressed confidence that the cash-strapped nation would keep servicing its debts, Bloomberg News reported. Kristalina Georgieva said that in the IMF’s assessment, Kenya’s debt is sustainable and the administration of President William Ruto is moving swiftly to improve its fiscal position. The remarks come at a sensitive time for the East African nation, with some investors dumping its bonds and questioning its ability to make a $2 billion payment next year. Kenya is one of several African countries facing growing investor concern about debt and access to funding, with Ghana and Zambia already declaring default and entering into restructuring talks. As of Friday, the African continent as a whole was trading as a “distressed” credit, according to a JPMorgan index, with an average yield of more than 1,000 basis points above the US benchmark. “Countries that are at the point of needing debt restructuring are still a relatively small group. Kenya is definitely not among them,” Georgieva said in a briefing with reporters on Wednesday in Nairobi. “We think Kenya is a case of innocent bystander. It has been hit by external shocks.” Read more.