World Bank Delays $260M Loan to Kenya Amid Allegations of Government Corruption
The World Bank on Tuesday delayed $260 million in loans to Kenya earmarked for HIV/AIDS, education and banking reform programs due to corruption concerns within the Kenyan government, the SAPA/Mail & Guardian reports (SAPA/Mail & Guardian, 1/31). The Kenyan Ministry of Health in February 2005 said that it had failed to distribute $54 million in funding to fight HIV/AIDS. Richard Abura, a Kenyan health ministry spokesperson, said the delay in distributing the money was caused by conditions -- including contracting with an agency to ensure that the funds are "well spent" and hiring 78 accountants to manage the funds -- set by the World Bank and the International Monetary Fund. Abura said the government took nine months to meet the conditions. U.S. Ambassador to Kenya William Bellamy said that corruption is the reason why only a fraction of $70 million in U.S. funding for HIV/AIDS programs had been disbursed, and other donors -- including the World Bank and the Global Fund To Fight AIDS, Tuberculosis and Malaria -- have not disbursed millions more in funding because they also are reluctant to contribute until the problem is resolved (Kaiser Daily HIV/AIDS Report, 2/3/05). Officials on Tuesday said the loans, which were approved in October 2004, will not be disbursed until bank officials are certain that President Mwai Kibaki's administration is adhering to its pledges to fight corruption. World Bank Country Director for Kenya Colin Bruce said bank officials currently are investigating the situation and are preparing an "integrity report" on Kenya that "will be the basis for releasing the money" (SAPA/Mail & Guardian, 1/31).This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.