1 October 2020
Last update on Thursday, October 1, 2020 At 8:30 AM
The measure aims to help the targeted structures to better cope with the covid-19 pandemic.
Kenya is preparing to launch a credit guarantee facility for businesses operating in the country. In total, $ 92 million will be released by the state for economic players.
The new measure is primarily intended for micro, small and medium companies. It will enable them to cope with the coronavirus pandemic which has considerably affected their turnover while increasing their liquidity needs.
According to Albert Mwenda, acting director general of budget affairs for the Kenyan National Treasury, the measure is part of the anti-Covid19 response plan put in place by the government of Uhuru Kenyatta. He wants to focus on helping small businesses because of their significant contribution to gross domestic product (GDP).
“The objective of the guarantee is to facilitate access to affordable credit for MSMEs by reducing the risk of default on loans,” said director Mwenda as quoted by Xinhua.
As a reminder, despite the impact of the coronavirus on its economy, Kenya hopes to maintain positive growth this year thanks to the response measures initiated by the government and the resilience of the agricultural sector. The Parliament’s budget office forecasts that the economy will grow between 1 and 2% by the end of the year.
Note that the new credit mechanism is scheduled to be implemented from October 2020.
Source Ecofin Agency
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