By John Njiraini

Kenya’s road to economic recovery is paved with numerous roadblocks and the Government must craft strategies to overcome them, International Monetary Fund (IMF) managing director has said.

Mr Dominique Strauss-Kahn said yesterday the country’s economic recovery and growth sustainability would depend on policymakers’ innovativeness, because of vulnerability to natural disasters, climate change and over-dependence on aid and remittances from the Diaspora.

"Policymakers need to explore strategies to revive strong growth and re-enforce resilience to shocks," he said during a high-level panel discussion at the University of Nairobi.

IMF Managing Director Dominique Straus-Kahn addressing the 37th Internet Corporation for Assigned Numbers and Names (ICANN) conference at the University of Nairobi Monday. [PHOTO: COLLINS KWEYU/STANDARD]

Slow Recovery

The discussion, which was attended by Prime Minister Raila Odinga and his deputy Uhuru Kenyatta, was themed "Africa Economic Transformation: The Road Ahead".

Strauss-Kahn said although the IMF was instrumental in helping the country overcome the challenges of the global economic and financial crisis, recovery was still sluggish and thus need for policies that would sustain recovery.

The IMF extended a loan of $200 million to Kenya to cope with the crisis, while Africa in general received $6 billion from the Fund last year.

"We lent in line with the needs of African countries, with less conditionalities mainly for growth and poverty reduction," he said.

Uhuru, who is also the Minister for Finance, called on the Fund to align its support and help Kenya achieve the ambitious Vision 2030 blueprint.

He said the Government was carrying out necessary reforms in the budgeting process, the financial sector, the capital markets, debt management among others and required the assistance of the IMF to conquer poverty and return to sustainable growth.

"We believe IMF can work with us in line with the theme of transforming our economy," said Uhuru.

Uhuru petitioned IMF to push developed countries to desist from tendencies of protectionism and open up their markets for trade with Africa.

He added that Africa has suffered because of subsidies that developed countries give their farmers. "Barriers to trade need to be removed to promote trade in a free world," he noted.

According to Strauss-Kahn, Africa was an innocent victim of the global crisis, with massive declines in trade, remittances, capital flow and job losses.

Economic growth in sub-Sahara plummeted from an average of six per cent before the crisis, to two per cent last year, while per capita income declined for the first time in two decades.

He said that although Africa is back on her feet, the continent still requires assistance in developing capacity, organising regional markets and creating international markets.

The Fund projects that this year economic growth in sub-Sahara Africa would reach 4.5 per cent.

Kahn urged Africa to be cautious when dealing with China.

"China is welcome here but the IMF will help you to have fair deals with it," he said.