Kenya To Borrow KSh 80b From IMF To Deal With Effects Of Climate Change

• A team from the International Monetary Fund (IMF) will visit Kenya on October 7, to review the disbursement of the loan
• The amount will support the country's ambitious efforts to build resilience to climate change and catalyse further private climate financing
• The United Arab Emirates (UAE) pledged $4.5 billion (KSh 675 billion) in clean energy investments in Africa on Tuesday, September 5

Kenya is set to borrow US$ 551.4 million (KSh 80.4 billion) from the International Monetary Fund (IMF) to deal with the effects of climate change.

The funds will be disbursed through the IMF’s Resilience and Sustainability Facility (RSF).

According to a statement by the IMF, the amount will support the country's ambitious efforts to build resilience to climate change and catalyse further private climate financing.

"Our team will come in to do the first review and discuss with the authorities the reforms progress and if satisfactory, the authorities can access the first batch of financing,” IMF’s deputy managing director, Bo Li, told Business Daily.

What Kenya should do

Between September 2023 and 2025, the IMF expects Kenya to raise KSh 477 billion annually in climate finance.

The private sector is expected to mobilise 39% of the funds from the amount.

President William Ruto's Cabinet is set to adopt a national framework for climate services to enable the dissemination of a digital early warning system.

What was pledged for climate action?

The United Arab Emirates (UAE) pledged $4.5 billion (KSh 675 billion) in clean energy investments in Africa on Tuesday, September 5, at a landmark climate summit to showcase the continent's potential as a green powerhouse.

President William Ruto sought to use the Africa Climate Summit in Nairobi to shift the narrative on the region, presenting the clean energy transition as a unique opportunity for Africa - if it can attract the financing to realise its potential.

Sultan Al Jaber, who heads the UAE's national oil company ADNOC and government-owned renewable energy company Masdar, said the investment would "jumpstart a pipeline of bankable clean energy projects.

Ruto unveils comprehensive legal framework

During the event, Ruto launched Kenya’s National Climate Change Action Plan (NCCAP) 2023-2027, Long-Term Low Emission Development Strategy (LT-LEDS) 2022-2050, and Climate Change Act (Amendment 2023).

President Ruto further said that Africa must channel adequate resources through investment and implement appropriate technologies to unleash the full potential of its clean and green natural resources.

"Showcasing African leadership through a comprehensive law and policy guiding national and subnational climate action, Kenya demonstrates readiness for support to implement the Nationally Determined Contribution (NDC) through the third NCCAP aligned with the LT LEDS," President Ruto said.