Central Bank Governor Kamau Thugge said on Friday, April 17, that talks are ongoing for an additional USD1.5 billion facility under the World Bank’s Rapid Results operation. The arrangement allows countries to rework and fast-track previously approved funding in response to economic shocks. He added that the government is targeting approval and release of the funds before June 30, 2026. "We have had a very good discussion with the World Bank on the particular issue and are also getting additional financing, given the kind of shocks that we are facing." "With the World Bank, we hope we can reach an agreement, especially with the Rapid Results Operation, so that we can get additional financing above the DPO. Our hope and expectation is that money will come in in this financial year," Thugge stated. Thugge noted that Kenya’s foreign exchange reserves remain at a comfortable level for now, but the government is seeking extra support to reinforce buffers in case global fuel disruptions persist for longer than expected. "Currently, we have about 5.8 months of import cover, and this is even before the disbursements of funds related to the Safaricom privatisation. Once that money comes in, that will strengthen our buffer even more to seven months of import cover," he stated. He further explained that upcoming funding from both the World Bank and the International Monetary Fund is expected to ease reliance on costly local borrowing, which has been weighing heavily on public finances. Thugge said the shift toward concessional financing would help lower interest expenses and reduce pressure on debt repayment. "The support from the IMF and the World Bank is concessional financing. It would replace the expensive domestic borrowing and therefore improve the debt vulnerabilities and reduce the cost of interest," the CBK governor reiterated. Meanwhile, the government continues to grapple with rising fuel prices despite ongoing subsidy measures. President William Ruto earlier confirmed that Sh6.2 billion was spent to support fuel prices between April 15 and May 14. Even with the subsidy and a reduction in value-added tax on petroleum products, fuel prices still went up by Sh28 per litre for super petrol and Sh30 per litre for diesel, intensifying pressure on households and businesses. The increase has sparked public concern, with many warning that transport and commodity prices are likely to rise further. The United Opposition has also announced plans for nationwide protests on Tuesday, April 21, if the situation is not addressed.
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Kenya seeks Sh193 billion World Bank loan to cushion fuel price pressure
Thugge noted that Kenya’s foreign exchange reserves remain at a comfortable level for now, but the government is seeking extra support to reinforce buffers in case global fuel disruptions persist for longer than expected.
Central Bank of Kenya Governor Kamau Thugge Appearing before the Senate Standing Committee on Devolution and Intergovernmental Relations at Bunge Towers, Nairobi on July 24, 2025. PHOTO/SENATE
Kenya is lining up new external financial support worth about Sh193 billion from the World Bank as it moves to cushion the economy from rising fuel costs linked to the ongoing Iran conflict, the Central Bank has said.