NAIROBI (Xinhua) --
The International Monetary Fund (IMF) said on
Friday that significant progress was made during the visit by
its review mission to Kenya, noting that discussions will
continue in the coming weeks.
The IMF’s review which
ended on Thursday was expected to see Kenya allowed or denied
further access to 1.5 billion U.S. dollars forex insurance
program with Kenya, which expires in September.
The lender which did not mention the status of the standby
facility however said discussions focused on fiscal policies to
achieve the authorities’ fiscal deficit target of 5.7 percent of
GDP in 2018/19 fiscal year; interest rate controls; and
structural reforms aiming to ensure the sustainability of
investment-driven, inclusive growth.
"The authorities reiterated their commitment to macroeconomic
policies that would maintain public debt on a sustainable path,
contain inflation within the target range, and preserve external
stability," IMF in a statement issued in Nairobi.
The IMF team and the Kenyan authorities had agreed that a
reduction in the fiscal deficit to 7.2 percent of GDP in 2017/18
and further to 5.7 percent of GDP in 2018/19, from 8.8 percent
in 2016/17 would be appropriate.
The IMF mission however said Kenya’s economy has continued to
perform well, with real GDP growth accelerating to 5.7 percent
in the first quarter of 2018, from 4.9 percent in 2017.
"The acceleration of growth is being driven primarily by
strengthened confidence following the conclusion of the
prolonged election period, favorable weather conditions, and a
continued recovery in tourism," Clements said.
He said inflation has remained within the authorities’ target
range since July 2017 as better weather conditions have brought
down food inflation.
Headline CPI growth was 4.3 percent year-on-year as of June
2018, while core inflation remained low at 3.6 percent