Kenya is likely to receive about USD 400 million in emergency financing from the World Bank within six weeks to help address risks, including an Ebola outbreak and El Nino-related disruptions.
The East African country applied for the World Bank’s emergency financing facility, known as a “Rapid Response Option,” after the start of the Iran war in February, with the geopolitical phenomenon shooting crude oil prices sharply higher.
However, as per Reuters, risks facing the East African country have broadened beyond pressure from high energy prices on government finances.
A spokesperson for the World Bank said the lender is supporting Kenya to finalise a framework to access rapid financing when “an eligible crisis or emergency occurs, including the conflict in the Middle East and El Niño.”
“The financing would help mitigate the impact of Ebola on the health sector, the El Nino weather phenomenon on agriculture and water resources, and high energy prices on the economy as a whole,” the Reuters report commented.
More than 3,000 people have died from the worst outbreak of Ebola in nearby Congo, with the contagion also spreading in Kenya’s direct neighbor Uganda.
Along with the disease, the East African nation also suffered its most severe El Nino episode in 1997, when months of heavy rain destroyed crops and damaged roads and homes.
World Bank emergency financing for countries like Kenya is typically capped at 10% of a country’s undisbursed lending portfolio, which would give Nairobi access to roughly USD 400 million.
Kenya has a World Bank project portfolio exceeding USD 7 billion, out of which about USD 3 billion has been disbursed or committed.
The two sides are reportedly finalizing a “Contingency Emergency Response Project” that will determine the funding terms, with the final amount dependent on the undisbursed balance when it is completed.
The World Bank board has already cleared the projects underpinning the “Rapid Response Option,” allowing funds to be released once the document is finalized.