Kenya: Govt Eyes Up to U.S.$350 Million Aid From U.S. to Finance Projects

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(file photo).
18 January 2020

The head of a special US development programme is due in Kenya in the coming week to hold initial talks on the country's potential eligibility for project funding of up to Sh35 billion.

Sean Cairncross, chief executive of the Millennium Development Corporation (MCC), said in a press briefing on Thursday that Kenya is making "excellent progress" toward meeting criteria for inclusion in the programme.

ASSESSMENTS

Successfully completing this initial step would likely result in Kenya being chosen for a "compact" with MCC. Such an arrangement, usually focused on infrastructure development, involves an MCC grant averaging about $350 million (Sh35 billion), Mr Cairncross said.

Established in 2004 during George W Bush's presidency, the MCC conditions its assistance on countries' performance in "ruling justly", following free-market economic policies, and investing in health, education and environment.

Since its inception, the MCC has awarded more than $8 billion (Sh800 billion) to 25 developing countries, 13 of them in Africa. Kenya must make additional progress in controlling corruption before it can be deemed eligible for an MCC compact, Mr Cairncross noted. The country's standing in that regard is determined by assessments by the World Bank and other "third-party data sources," the MCC director said.

REFORMS

Corruption does not have to be eradicated for Kenya to qualify for an MCC compact, Mr Cairncross told reporters. Eligibility for aid is assessed on the basis of a "trend toward dealing with that corruption and a willingness to engage government resources and political will to take those issues on," he said.

This is not the first MCC threshold programme for which Kenya has been chosen. It entered into an initiative of that type in 2007, which was aimed at reforming public procurement systems, improving health service delivery, and enhancing the monitoring capacity of government and civil-society organisations.

Despite some progress on each of those fronts, Kenya still fell short of the eligibility standards when the first threshold programme concluded in 2010.

"Kenya is an important partner in East Africa," the MCC said in December, announcing the country's approval for a second threshold programme.

INVESTMENTS

That move reflects Washington's aim to counter China's influence in Kenya through its large-scale infrastructure investments in recent years.

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