NAIROBI: The head of the African Development Bank unveiled a $540 million loan for Kenya yesterday and said he saw East Africa’s biggest economy recovering from a post-election crisis to grow at 7 percent.
Kenya was rocked by ethnic and political violence at the start of the year following a disputed presidential election in December. But a grand coalition government forged in April after weeks of peace talks has restored stability.
“I’m extremely encouraged and bullish about Kenya,” AfDB President Donald Kaberuka told a news conference in Nairobi.
“I’m quite confident that if we can get fertilizer to farmers on time, and if the progress being made by the coalition government can continue, I don’t see why Kenya cannot maintain a growth figure of 7 percent and above.”
Kaberuka said the government was aiming for double-digit growth long term. But he said that would require significant investment in areas like infrastructure and energy.
He said the negotiated solution to Kenya’s political turmoil — in which some 1,500 people were killed and more than 250,000 forced from their homes — provided a possible example of how best to deal with other problems on the continent.
“Kenya walked to the brink but was able to pull back at the right moment, thanks to the courage of its leaders and support of it friends,” Kaberuka said.
But he stressed that there were many challenges ahead for the government and its people, and no quick fixes.
“I want to urge the friends of Kenya in the international community to step forward now and provide the needed support for the grand coalition to maintain the trajectory,” he said.
He said the AfDB was considering providing the government with additional funding worth $10 million to buy fertilizers.
The price of fertilizer on the international market had risen nearly five times since the start of this year, he added.
In May, the Tunis-based bank set up a fertilizer facility to help African farmers battle high costs and boost production as food prices surge. Sharp price increases for staple foods this year have threatened to trigger inflation and choke growth.
Despite the crisis in the global financial markets, the risk of economic slowdown in major Western countries and high fuel prices, Kaberuka was confident that growth for the continent as a whole this year would average at least 6 percent.
