IMF Increases Annual Loan Limit to Sub-Saharan Countries

The international Monetary Fund has pledged to continue loaning sub-Saharan countries into 2021.

This year, the institution released $16 billion in loans and debt relief as emergency assistance but more is needed since the global financial markets have become too expensive for small economies.

The IMF said that emergency loans to countries like Kenya have placed them nearer to the limits set and hence the IMF has temporarily increased annual limits.

“The IMF is stepping up efforts to continue this support in 2021. Many of the countries that have received funding from the IMF have reached, or are approaching, their relevant limits for annual access,” said IMF in Sub-Saharan Africa regional Economic Outlook.

The report added that “the IMF has temporarily increased these annual limits and has allowed for more frequent disbursements under the Rapid Credit Facility, allowing members to obtain further financial support from the IMF during this extraordinary period.”

In May, Kenya received $739 million (ksh 79.3) billion loan from IMF to help fight coronavirus. This came at a time when concerns were raised over how COVID-19 funds were being used in the country.

The IMF acknowledged these concerns but said many countries have put in measures to track COVID-19 related spending, including independent audits of crisis-related spending.