Kenyans reject new WB and IMF lending

News|Bretton Woods Project|15 April 2000|update 16|url
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The Stakeholders Support Group (SSG), formed by Kenyan opposition party members, lawyers and NGOs, is protesting against the resumption of IMF lending, saying that the government has not made the necessary reforms to stamp out corruption. Lending was suspended 3 years ago because of official corruption. The SSG has challenged the IMF to demonstrate achievements made by Moi's government on each of the conditions it set if it is truly committed to ensuring accountability and transparency in Kenya. The government claims to have fulfilled all the conditions, which includes setting up an anti-corruption authority and cutting back the civil service.

The SSG wants resumption of aid to Kenya tied to constitutional reform to reduce presidential powers, which includes limiting presidential rule to two five year terms. There are fears that president Moi, whose term in office should end in 2002, will try to maintain his hold on power. The SSG has accused the British government of pressuring the IMF to resume lending to maintain Moi's regime.

The Kenyan NGO Working Group on the World Bank argue in a policy paper that if aid is to be resumed then transparency and participation must be central to the processes for developing a poverty reduction strategy paper (PRSP) and a medium term expenditure framework (MTEF). The paper makes 19 recommendations including:

• the government must evolve an acceptable process of negotiation over the sequencing of consultations and scope for participation by the other partners such as civil society and business communities in the development of the interim PRSP;
• the government must work closely with the private and NGO media to develop an information disclosure procedure and a strategy for building national understanding, scrutiny and ownership of the MTEF/PRSP;
• the government must clearly link the National Poverty Eradication Plan (NPEP) framework and the PRSP;
• the Ministry of Finance and Planning must set sound fiscal choices in a transparent manner that prioritises productive and social programmes such as basic health services and eduction and economic development rather than non-productive expenditures.

The Government held a workshop to discuss its draft interim PRSP which included civil society and the private sector. A final version will be available soon which will be the basis for completing discussions with IMF and the World Bank on new lending.

The government intends to embark on a bigger consultative process to feed into the production of a full PRSP which should be completed by early 2001.

For a copy of the NGO World Bank working Group's paper, email awood@brettonwoodsproject.org

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Published: 15 April 2000 , last edited: 8 February 2010

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