World Bank officials have confirmed the government's new procurement system, Electronic Government Procurement (eGP), is among the strict conditions it has placed for further loans to Kenya. This comes as the government last month said it has no option but to continue borrowing to meet budgetary needs.
The World Bank said in an interview with Bloomberg that it will unlock further financing for Kenya on the condition that President William Ruto's government implements wide-ranging economic reforms agreed on last year.
Some of the measures agreed upon under the programme include the rollout of an electronic procurement system (eGP), which was launched by Treasury CS John Mbadi on Monday.
This means that all Kenyans seeking government tenders, bid bonds, procurement plans, tender evaluations, and budgetary allocations must go through the eGP system.
Additionally, Kenya must consolidate all government finances into a single account at the Central Bank and deal with the misuse of funds. The government has been making progress on this, with Central Bank Governor Kamau Thugge telling registrators last week the plans are in advanced stages.
Other reforms include integrating refugees to live and work in Kenya, with the government having endorsed the formation of the Ushirika plan in March.
The World Bank also directed Kenya to enhance social assistance to poor households through improving the Inua Jamii project.
Further, Kenya is supposed to harmonise business licensing requirements and develop the Nairobi Commuter Rail Service to address the traffic congestion menace.
The development policy operation funding ''will proceed when all prior actions are met by the authorities, conditional on maintaining an adequate macro-fiscal policy framework,'' a spokesperson for the lender told Bloomberg.
However, it was not immediately clear how much Kenya would receive from the international lender, with some reports suggesting that it could be pegged at Ksh97.12 billion (USD750 million).
''An amount has not yet been determined,'' the World Bank added in its response.
Kenya received Ksh155.39 billion (USD1.2 billion) of World Bank budget financing last year and pledged to pursue fiscal consolidation and to achieve a new debt anchor set at 55 per cent of gross domestic product by 2029.
Treasury Secretary John Mbadi has revealed before that Kenya is in negotiations for another Ksh97.12 billion (USD750 million) from the lender.
Last month, the government announced that it had abandoned the Ksh110.07 billion (USD850 million) four-year borrowing program that was under assessment by the International Monetary Fund (IMF).
This put Kenya in an awkward position, according to fiscal analysts who argued that the debt position of Kenya could face difficulties.
On Monday, Mbadi directed all Principal Secretaries and accounting officers to ensure their departments comply with the implementation of the new Electronic Government Procurement (eGP) system.
Speaking at the eGP launch in Nairobi on Monday, Mbadi directed the accounting officers of Ministries, Departments, and Agencies (MDAs), particularly the PSs, to immediately begin rolling out the system within their departments and with suppliers.
