Kenya’s bid for a $600 million emergency loan from the World Bank has stalled, with the lender saying Nairobi has not yet spelled out how it intends to spend the money.
The funds were sought through the World Bank’s Rapid Response Option (RRO), a mechanism that lets member countries redirect up to 10 percent of their undisbursed financing toward sudden crises. The lender had been expected to release the money by the end of June 2026 through the facility, which is designed to help governments respond to sudden economic crises. Kenya applied for the funding in April, citing shocks from the US-Israel war on Iran, which began at the end of February.
Anne Bakilana, an operations manager at the World Bank’s Kenya office, confirmed the government had formally requested the RRO and completed the initial sign-up process, but said a key step remains unresolved. As she put it, “Yes, the government has completed the procedure of registering for the option and has requested the RRO. We are in the process of determining precisely which expenditures the government wants to fund in an emergency.”
The request was formally raised during the World Bank and IMF Spring Meetings in Washington in April, after Kenya’s foreign exchange reserves fell by $1.2 billion between March 5 and April 9, 2026. At the time, the emergency request had not yet made it onto the World Bank board’s agenda, even as a related $750 million Development Policy Operation loan was being considered separately.
The World Bank has also grown more cautious about Kenya’s broader economic outlook. It cut its 2026 growth projection for the country to 4.3 percent, a 0.6 percentage point reduction from its October 2025 estimate, pointing to reduced business productivity amid rising fuel and fertilizer costs and inflation eroding household spending power.
On the related DPO facility, which was eventually approved in June, the World Bank framed the support as tied to governance and fiscal reforms. For now, disbursement of the emergency loan hinges on Kenya submitting a detailed spending framework, a step Nairobi has yet to complete.
