Treasury Cabinet Secretary nominee John Mbadi has defended the International Monetary Fund (IMF) from blame regarding Kenya’s ongoing debt and tax issues, which have sparked mass protests over the past two months.
During his vetting by Parliament’s Committee on Appointments on Saturday, Mbadi clarified that the IMF does not impose itself on countries but is invited to assist. He explained that Kenya had been self-sufficient but turned to the IMF for support following the Covid-19 pandemic and other disruptions that hindered the country’s financial independence.
Mbadi highlighted that Kenya’s agreement with the IMF includes measures to raise revenue, but the specifics can be adjusted to avoid excessive burden on taxpayers.
“I want to be very clear on IMF…IMF will never invite themselves to a country, we do invite them, and agree with them on a programme. There was a period we were not under IMF, but because of challenges, occasioned largely by Covid-19, and the drought in the region, and the global disturbance of the supply chain, we then went back to IMF in 2020/2021,” he said.
“But I have looked at what are these conditionalities? You know sometimes we may blame IMF for nothing. We have agreed with them on a programme that for us to tap into that loan, what we must do in fact is one key thing; revenue mobilization. So we just need to agree on how we can convince IMF for the period that we’re going to be under their programme, which I don’t think should be long.”
Mbadi stressed the importance of Kenya regaining financial independence and reducing reliance on the IMF. He emphasized the need to increase the country’s tax-to-GDP ratio back to 18%, which could inject over Ksh.600 billion into the National Treasury.
“We must move to a system where we divorce ourselves from IMF, and depend on ourselves as we were doing before, but that we can only do by doing what can be done in the interest of the country,” stated the former Nominated MP.
“They want us to maintain a deficit of no more than 4.4%, that’s what we have agreed on currently, but we’re moving towards a budget deficit in the region of 2.5-3%. I know government has talked about 3.1%, we can sustain a financing gap of 3%. With that you will not need IMF intervention.”
He added: “If we take back our tax revenue to GDP to 18%, we will be adding to our exchequer not less than Ksh.600 billion, and I think it is achievable.”
Mbadi’s remarks underscore a vision for Kenya’s financial future that is less dependent on international aid and more focused on robust internal revenue generation.
