Donors give cautious approval.

Author:Redfern, Paul
Position:Kenya wins World Bank approval

Although Kenya received a vote of approval at the World Bank meeting in Paris, serious concerns about the country's economy remain. The aid package, as Paul Redfern reports, is highly conditional and Kenya will have to watch its step every inch of the way.

The $730m aid package will provide much needed support for the country's balance of payments problems. However, the majority of funds will still be conditional to continued economic and political reforms. It also remains unclear exactly how much of the $730m is new funding.

At the last World Bank Consultative Group meeting in December 1994, $800m was pledged. By March of this year, much of this funding had still not been forthcoming. So some of the new funds are in effect old funds which have simply been repledged.

Some of the donor community, notably the Scandinavian countries, are said to have serious doubts about backing the Kenyan Government's reform efforts. Their particular cause of concern is the effort to tackle corruption which, they believe, is purely cosmetic.

Serious concerns also surround the independence of the judiciary, the shelved media legislation and the Government's continued refusal to take action on constitutional reform. On this latter point, most donors recognise that the extent of chaos among the opposition means there is no real challenge to the Government.

Ford Asili leader, Mr Ken Matiba, will have caused particular alarm in his suggestion that the Asian and white communities should be thrown out. The infighting in Ford Kenya and deep divisions within the Democratic Party leave the donors with little choice but to deal with Kanu, whether they like it or not.

With the 1997 elections virtually in the bag for the ruling party, most donors will hope to rebuild bridges. In view of the row between Ms Lynda Chalker, UK ODA Minister, and President Moi last year, the British will be at the forefront. The main aim of the donors will be to caution the Kenyan Government against continued political repression.

Many critics argue that the donor community has been down this road before. But there are signs that some of the hard-liners within the ruling party, notably former Cabinet Minister, Mr Nicholas Biwott and even Vice President, Mr George Saitoti, are being increasingly marginalised. Moreover, according to the WB, the economy is improving with growth rates up to 5% last year.

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