April 14, 2026 — The International Monetary Fund has directed Kenya to classify at least KSh 335 billion raised through future tax pledges as public debt, a move that could significantly impact President William Ruto’s infrastructure financing strategy and ongoing talks for a new IMF lending programme.
In a report published on its website, the IMF states that Kenya has raised approximately KSh 335 billion (about USD 2.6 billion) by securitising future tax revenues to fund major infrastructure projects across the country.
The arrangement means the government has been using expected future tax collections as collateral to access funds upfront, financing projects such as roads, railways, stadiums, and airport upgrades without officially recording the liabilities as part of the national debt.
However, the IMF maintains that such financing must be treated as debt under international standards. “Such income should be recognised as a debt liability under international statistical standards,” the Fund states.
Among the projects cited is the construction of Talanta Stadium, funded through the sports levy, the Mau–Rironi dual carriageway supported by fuel tax revenues, and the extension of the Standard Gauge Railway from Naivasha to Malaba, financed through import duty collections. Passenger taxes have also been earmarked for the expansion of Jomo Kenyatta International Airport.
The IMF further outlines that securitised revenues should either be recorded as a loan to a special financing unit or treated as direct government borrowing. “Securitisation of future revenue should either be treated as a loan to the securitisation unit or as direct borrowing of the government,” the report states.
Analysts say the directive leaves limited room for Kenya’s National Treasury, as reclassifying the funds would increase the country’s official debt levels, tighten borrowing limits, and subject such financing arrangements to stricter oversight.
John Mbadi has previously opposed such classification, arguing that securitised financing operates off the government’s balance sheet and should not be considered public debt.
The development comes after a high-level meeting held on April 13 in Washington, D.C., bringing together IMF Managing Director Kristalina Georgieva and Kenyan officials, including National Treasury and Central Bank representatives. Discussions focus on Kenya’s economic outlook, inflation, reform priorities, and the impact of global tensions.
The IMF also assures Kenya of continued support in cushioning the economy against external shocks, even as the debate over debt classification adds new pressure on the government’s fiscal strategy.