Uncertainty Looms for Kenya Following Tense IMF/World Bank Spring Meetings

By Janet Ngombalu
NAIROBI, Kenya, May 5 2025 – Reflecting on this year’s IMF/World Bank Spring Meetings, one word lingers in my mind: uncertainty. The shifting global geopolitical landscape loomed large—none more so than the US administration’s initial threat to withdraw from the Bretton Woods institutions.

Although that threat was later withdrawn, it’s clear the US wants sweeping reforms. What exactly those changes will look like remains unknown, but it’s clear that the US wants the IMF and World Bank to focus more on its biggest shareholders rather than people and the planet. For countries in the Global South, like my own—Kenya—that could be disastrous.

As the world knows, the people of Kenya made their frustrations against the IMF known last year, with protests against IMF fiscal and austerity policies. And this unrest led to President William Ruto withdrawing a finance bill aiming to raise more than $2 billion in taxes.

Then, just last month, a four-year $3.6 billion IMF deal was terminated by mutual agreement. A new deal is now being negotiated—but finding balance will be difficult. The IMF is demanding fiscal consolidation, while the government is under immense pressure to ease the burden on a struggling population.

Without raising taxes, Kenya faces drastic cuts to public spending. But the people have had enough—and they shouldn’t be forced to endure more.

Dead livestock in Bubisa, Marsabit County due to prolonged drought: Credit: Pasca Chesach/Christian Aid Kenya

This is happening at a critical moment. The IMF is undergoing two major reviews this year that will shape its lending and surveillance approach for the next five years. If the Trump administration gains more sway over IMF leadership, civil society fears a regression to the 1990s era of even harsher austerity.

The reality on the ground in Kenya makes this unacceptable. We already face high taxes, and cuts to essential services are tearing the social fabric apart. Our health system is stretched beyond its limits.

Last year, doctors were driven to suicide under the weight of low pay, impossible hours, and the heartbreak of losing patients due to inadequate care.

School feeding programmes – lifelines for many children – have been cut. For some, that was the only meal of the day. Businesses are closing, jobs are vanishing, and those of us still employed are helping family members who are struggling.

A resident of Makueni fetches water from a community booth made possible through Christian Aid Kenya’s sand dam project, offering a reliable water source amid prolonged drought. Credit: Fauzia Hussein/Christian Aid Kenya

Meanwhile, the US is calling on the IMF and World Bank to scale back focus on gender equality and climate change. This is deeply alarming. As Kenya’s country director for Christian Aid, I am currently seeking emergency funds to respond to severe flooding in Marsabit and Wajir in the northeast of the country, which have also been heavily affected by drought.

Kenya loses up to KSh870 billion every year, around 3–5% of GDP, due to climate impacts. Yet we’ve done almost nothing to cause this crisis.

Women in particular continue to bear the brunt of IMF-imposed austerity. They face rising food prices head-on, as the ones more responsible for food shopping. They dominate the informal and public sectors – precisely the sectors most affected by spending cuts.

We had started to make scant progress in getting the IMF to consider these gendered impacts. Now, that progress is under threat.

There’s also growing unease about the politicisation of global financial governance. If the US gains even more influence over the IMF, will there be favouritism in lending decisions? The recent cancellation of US Secretary of State Marco Rubio’s trip to Kenya, following President Ruto’s visit to China, raises eyebrows.

The rise of this selfish, unilateral approach is troubling—and it’s already hurting us. Massive aid cuts are hitting hard. In addition to the proposed $60 billion USAID budget reduction, the UK, Germany, France, and the Netherlands have announced cuts totalling over $11 billion combined.

It feels as though the Global South is being abandoned in a power struggle we didn’t start. The IMF and World Bank, created in the colonial era, have always tilted toward northern interests. The US holds 16% of IMF voting power and therefore a veto over most important decisions which require 85% agreement. Meanwhile, the entire African continent holds just 4.7%. That imbalance is not only unjust; it’s unsustainable.

And now, it could get worse. But there is hope.

The upcoming Financing for Development Conference in Seville this June offers a rare and crucial opportunity. It is the only global forum where all countries negotiate economic governance on equal terms.

We must seize this moment to push for meaningful reform—debt relief, fairer international tax rules, and real climate finance. These are the changes we need to unlock a future where all countries have the tools and autonomy to shape their own development.

We cannot afford more uncertainty. We need control over our economic destiny, not to be tossed around by the shifting whims of the Global North.

Bring on Seville. It’s time for change.

IPS UN Bureau

Follow @IPSNewsUNBureau
!function(d,s,id){var js,fjs=d.getElementsByTagName(s)[0],p=/^http:/.test(d.location)?’http’:’https’;if(!d.getElementById(id)){js=d.createElement(s);js.id=id;js.src=p+’://platform.twitter.com/widgets.js’;fjs.parentNode.insertBefore(js,fjs);}}(document, ‘script’, ‘twitter-wjs’);  

Excerpt:

Janet Ngombalu is Kenya Country Director, Christian Aid