Lending Institutions, Health Care, and Human Capital
Developing nations are also referred to as the LDC’s (Less-Developed Countries); the countries are characterized with an industrial base that is undeveloped, lower living standards and low HDI (Human Development Index) as compared to other nations in the world (Wrong, 2010). GDP per Capita (Gross Domestic Product) is used in comparing nations, this paper focus at Kenya, which a developing nation in Africa. Kenya is considered the entry point to Africa after South Africa. Kenya is ranked among the largest receiver of the loans from the World Bank and International Monetary Fund (IMF) (Irungu, 2013).
It has been noted that funds from the World Bank and IMF are helping Kenya socially, economically and politically (Imf.org, 2013). Surveys indicated that Kenya is considered among the biggest borrowers of the loans from IMF and World Bank; this is according to surveys conducted by the World Bank. Ethiopia and Nigeria are also ranked among the biggest recipients of the funds. Considering 2008, it was noted that Kenya had so far received a total of zero point six billion United States dollars, an indication that Kenya heavily rely on loans for funding infrastructures and development (Wrong, 2010).
Kenya has borrowed cumulatively more than nine billion United States dollars, marking Kenya as the sixth borrower in the African continent. The main challenge with Kenya is based on the mismanagement of the funds, IMF and World Bank on return has developed stringent measures in guiding the usage of the funds according to the proposed model (Imf.org, 2013).
An example of projects supported by the World Bank and the IMF includes energy sector, agricultural sector and in the infrastructure. Lighting Africa Project focus at Ghana and Kenya where the funds has facilitated development of off-grid solar lighting systems. Similar projects are projected to be replicated in other developing nations of Africa. The vision of the project is to reach more than two hundred fifty million people in the world by the end of the 2030 (Irungu, 2013).
Funds to Kenya are channeled into the country through IDA (International Development Association), which is part of World Bank’s lending arm. The funds are subjected to a grant element accounting to thirty five percent and also subjected to a grant period. Kenya benefits from the IMF’s Extended Credit Facility (ECF), IMF has contributed significantly to the economic reforms in Kenya (Imf.org, 2013). One of the most supported industries is the tourism industry after experiencing shocks due to the global financial crisis. IMF has been influential in improving the economy of Kenya, through developing mechanism of reducing unemployment, securing financial stability, enhancing economic growth, reduction of poverty and promoting international trade (Globaledge.msu.edu, 2012). IMF and World Bank has been influential in improving economic, social and political development in the region.
Health of the Population
Kenya is affected by tropical diseases like tuberculosis and malaria, which has been an issue in the nation. Another challenge is the human immunodeficiency virus (HIV) which results to immune deficiency syndrome (AIDS). Majority of the affected persons are the children and women in the society. The country is characterized with charged disputes that are politically instigated. Life expectancy of Kenyans is low as compared to life expectancy of people in the developed nations. Another challenging health problem in Kenya relates with the motor vehicle accidents, with the nation having one of the highest statistics in the world. Public transportation is the worst hit by the occurrences of the road accidents (Litali, 2013).
Surveys have indicated that there are direct relationships between economic conditions and the health factor in Kenya. It has been noted that rich nations like the United States has better health care as compared to Kenya. Kenya has been improving the health care of its individuals, and as a result, the nation has focused more on the economic development (Litali, 2013). The Kenyan economy is market based, some of the most influential programs identify with Kenya Economic Stimulus Program (ESP), that focus at boasting the economic recovery of Kenya, investing solutions to the issues of the food security, expanding creation of employments through expanding economic opportunities, promoting social stability and equity in the regional development, improving the quality of education and infrastructure, improving the health care of the nation, conserving the environment and in expanding the opportunities related to the economic growth in the region (Globaledge.msu.edu, 2012).
Macroeconomics argue that human capital contribute significantly to the economic growth of nations. Good health contributes to sizable, positive and statistically significant to the economic growth. Good health of a nation generally influences the economic development of a nation. Better health in the recent times in Kenya has increased the workforce productivity. Good health in Kenya has also contributed to high levels of educated people in the society, and that the nation is spending fewer funds on medical care. Such funds are channeled to development projects in Kenya and finally good health has facilitated building of income among the Kenyan families. Kenyan’s capital city is known as Nairobi, and a walk within the periphery of the city is characterized with new buildings coming up, an indication that the nation is experiencing better economic times than decades before (Litali, 2013).
Leadership in Kenya
Kenya do not manage IMF and World Bank funds appropriately, the main challenge is the high rate of corruption (Imf.org, 2013). IMF and World Bank in 1997 and in 2001 had stopped issuing of loans to Kenya due to gross misconducts. World Bank and IMF have responded by developing stringent measures in discouraging misuse of public funds. Foreign aid in Kenya has a history of corruption in the administration of public funds (Tomasevski, 2008). According to the surveys done in 2012, it was noted that Kenya was at position 139/176 among the most corrupt nations in the world (Irungu, 2013). Average Kenya parts with sixteen bribes in a month in the major cities and highways. Kenya is experiencing diverse market reforms, although businesses and people find themselves paying for bribes in facilitating ‘things be done’, particularly in the public sector.
The government of Kenya has developed a website to reduce the cases of corruption within the region and in making sure that the foreign aid is used appropriately (Tomasevski, 2008). The website www.president.go.ke will be influential in reporting cases of corruption in the region. Kenya believes that fighting diseases is critical for the overall economic health of the nations (Litali, 2013).
Kenyan economy is the largest in East Africa hence playing as a vital hub for transportation and finances; the nation has constantly experienced rapid economic growth through public investments, foreign investments and through private industrial development (Globaledge.msu.edu, 2012). The Kenyan government had failed in a number of occasions to honor its commitments particularly in areas of governance. Economic reforms were initiated in 2003 and IMF and World Bank resumed operations in the region. IMF in 2009 offered huge contributions to the country through the Exogenous Shock Facility (ESF). IMF and world bank has been influential in social, economic and political developments in Kenya.
References
Globaledge.msu.edu. (2012). Kenya: Economy. Retrieved November 18, 2013, from Globaledge.msu.edu: http://globaledge.msu.edu/countries/kenya/economy
Imf.org. (2013, October 02). Statement at the Conclusion of an IMF Mission to Kenya. Retrieved November 18, 2013, from Imf.org: http://www.imf.org/external/np/sec/pr/2013/pr13382.htm
Irungu, G. (2013, October 13). Kenya ranked third largest recipient of World Bank loans. Retrieved November 18, 2013, from Businessdailyafrica.com: http://www.businessdailyafrica.com/Kenya-ranked-third-largest-recipient-of-World-Bank-loans/-/539552/2030434/-/8ql4nu/-/index.html
Litali, G. (2013). Financing health care in Kenya. Saarbrücken: LAP LAMBERT Academic Publishing.
Tomasevski, K. (2008). Foreign aid and human rights: Case studies of Bangladesh and Kenya . Copenhagen: Danish Center of Human Rights.
Wrong, M. (2010). It’s Our Turn to Eat: The Story of a Kenyan Whistle-Blower. New York: Harper Perennial.
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