Kenya seeks $1.5 bln loan from the UAE, agencies

Kenya is seeking a financing of $1.5 billion from the UAE to bolster its public finances, Reuters and Bloomberg reported, citing sources.

Kenya has sought to curb its widening fiscal deficit and growing debt servicing by tax hikes which triggered the most violent protests in the country’s history.

A delay in reaching a financing deal with the IMF has worsened Kenya’s financial outlook, with the deficit expected to widen to 4.3% this year, compared with a planned pre-protest target of 3.3%.

Facing public calls to resign, Ruto has said the government will turn to slashing a $2.7 billion budget deficit by half and borrowing the rest, without saying from where.

Ruto has become deeply unpopular in his two years in office over his quest to introduce taxes meant to enable Kenya to repay its $80 billion public debt to lenders including the World Bank, the International Monetary Fund, and China.

The public debt makes up about 70% of Kenya’s gross domestic product, the highest in 20 years.