Kenya has overtaken Nigeria to become the continent’s third-largest recipient of funding from the African Development Bank (AfDB), highlighting the country’s growing reliance on multilateral loans amid economic pressures.
New disclosures by the continental lender show that it disbursed Sh43.7 billion to Kenya last year, up from Sh33 billion in 2024, dwarfing Nigeria’s Sh41.9 billion after Abuja more than halved its drawdowns from the bank.
Nairobi accessed two additional loans from AfDB’s non-concessional arm, bringing the total to 23, with an outstanding balance of Sh366 billion. It also secured three more loans from the African Development Fund (ADF) – the lender’s concessional arm – raising the total to 74, also valued at a total of Sh366 billion.
The increase in Kenya’s borrowing from the continental lender came amid burgeoning public debt and higher debt-servicing costs on commercial loans, prompting greater reliance on multilateral financing.
Development funding
Kenya has traditionally tapped AfDB loans to finance development projects and ease pressure on the Exchequer. Last year, the largest loan approved for Kenya was worth Sh10.7 billion and was earmarked for the modernisation of science, technology, engineering and mathematics (STEM) infrastructure in public universities.
In addition to this project, the lender disbursed funds for several other programmes, many of which were approved in earlier years and remain under implementation.
“The bank also supported clean cooking through standalone operations in Kenya and Uganda… these interventions advanced the Bank Group’s energy priorities as a key delivery channel for climate action,” AfDB said in its annual report.
With Sh43.7 billion received, Kenya ranked behind only South Africa and Morocco in AfDB disbursements last year. Both countries have traditionally been among the lender’s largest recipients and shareholders on the continent.
South Africa received Sh151 billion, up from Sh77 billion, while Morocco received Sh87.5 billion, compared with Sh70.6 billion in 2024.
Regional ranking
Nigeria, which was the largest recipient of AfDB funds in 2024, saw its disbursements from the bank more than halve in 2025, from Sh87 billion a year earlier, signalling a sharp slowdown in uptake of the lender’s financing.
For Kenya, the increase came as its financing relationship with the International Monetary Fund (IMF) entered a period of uncertainty following the expiry of its programme.
Data from the National Treasury shows that Kenya is increasingly turning to concessional multilateral debt for external borrowing. Loans from development finance institutions such as AfDB now account for 56 percent of all external debt, up from 50 percent at the end of 2023.
AfDB is Kenya’s second-largest multilateral lender after the World Bank.
Generally, Kenya is more indebted to AfDB than many of its continental peers. As of the end of 2025, Kenya’s unpaid loans to the bank’s non-concessional arm accounted for 5.42 percent of all outstanding balances, ranking behind only Morocco, South Africa, Tunisia and Nigeria.
Its outstanding loans from the concessional arm accounted for 11.19 percent of total balances, second only to Tanzania.
