Kenya's interior ministry said on Wednesday that it had suspended the local activities of cryptocurrency project Worldcoin while government agencies assess potential risks to public safety, Reuters reported. The project founded by OpenAI CEO Sam Altman launched last week. It requires users to give their iris scans in exchange for a digital ID, and in some countries users also get free cryptocurrency as part of plans to create a new "identity and financial network".
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The International Monetary Fund approved almost $1 billion for Kenya, saying the East African country had met conditions for continued financing under programs to help reform the economy and confront challenges posed by climate change, Bloomberg reported. Kenya got a $415 million disbursement under the Extended Fund Facility and Expanded Credit Facility, programs designed to shore up its economy and boost its foreign exchange reserves, following a fifth review.
Kenya is considering options including a potential buyback of part of a $2 billion bond due next year, Bloomberg News reported. Chris Kiptoo, the principal secretary of the National Treasury, declined to confirm the possible debt repurchase, but said the country is in talks with advisors and reviewing other alternatives. “We have many options,” he said in an interview.
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The World Bank said on Tuesday it approved a $1 billion loan to Kenya to support its budget as East Africa's economic powerhouse confronts high debts and a weakening currency, Reuters reported. The lending will be done through an instrument called a Development Policy Operations (DPO) loan, which commits Kenya to instituting reforms aimed at creating fiscal space, improving agricultural competitiveness and improving governance.
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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.
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Kenya's central bank held its benchmark lending rate steady at 8.75% on Monday, its monetary policy committee said, saying its last hike in November was still working its way through the economy, Reuters reported. Six out of nine market participants polled by Reuters had predicted the bank would hold the rate steady, while three expected it would be raised. The move bucks the trend among major African central banks who have maintained a tightening stance into this year. Policymakers in Nigeria and South Africa hiked rates last week, while their Ghanaian counterparts hiked earlier on Monday.
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Kenya Airways PLC's pilots union will give its final decision later tonight on whether to begin a strike on Saturday after the government urged them to it call off, the transport minister said on Friday, Reuters reported. The walkout, which is due to start at 6.00 am local time, will affect thousands of business and leisure travelers at one of the most important aviation hubs in the continent.
Kenya plans to tighten spending and step up efforts to collect more tax as it seeks to bring ballooning state debt under control, Bloomberg News reported. The budget deficit is projected to drop to 6.2% of gross domestic product in the year through June 2023, Treasury Secretary Ukur Yatani said on Thursday in his budget speech to parliament in Nairobi, the capital. That compares with an estimated deficit of 8.1% of GDP this year. He plans to finance the 862.5 billion-shilling ($7.5 billion) gap by raising 581.7 billion shillings domestically and 280.7 billion shillings offshore.
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Kenya Airways Plc has selected financial advisers at Seabury Securities to help the airline evaluate options to restructure its debt load, Bloomberg News reported. The airline, in which the Kenyan government has a 48.9% stake, faces mounting debts and depressed passenger demand amid pandemic-related travel restrictions. A representative for Kenya Airways said the carrier is in talks with several consultants, including Seabury, but declined to elaborate further. A representative for Seabury Securities declined to comment.
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Kenya’s debt service costs, which are expected to surge by 22% this fiscal year, are set to rise even further as the East African economy’s currency sinks to all-time lows against the dollar, Bloomberg News reported. Kenya’s Treasury expects to spend a record 1.17 trillion shillings ($10.4 billion) in the year through June on loan repayments, equivalent to about two-thirds of its revenue, according to the parliament’s budget office. This will be compounded by a 2.6% depreciation by the Kenyan shilling so far this year, after the currency fell to 112.06 per dollar.
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