Kenya : commodity import program (CIP); and technical assistance (TA)

Balance of payments assistance will be provided through the private sector. The grant will be authorized in 3 tranches and consist of 3 parts: a Fertilizer Market Development program; a Commodity Import Program (CIP); and TA. Local currency generations will be used for public sector development purposes, for establishment of a trust fund to support private sector development activities, and to cover USAID/K operating expenses. PAAD Amendment (PD-BBR-630) and new Project Paper (PD-BBN-559) of 8/18/88 authorize, respectively, (1) an additional CIP grant, and (2) TA, training, and commodities in support thereof. Local currency proceeds will be used to reduce the GOK"s budget deficit and encourage institutional changes and policy initiatives, while TA will address the two latter areas. The program will also continue to foster structural and sectoral reforms, especially for agriculture, by, inter alia: (1) supporting market-based fertilizer policies which promote rural distribution, liberalize import licensing, and strengthen the Ministry of Agriculture"s Fertilizer Inputs Unit; (2) encouraging further import liberalization; and (3) initiating actions to establish a Capital Market Development Authority. PP Amendment of 8/30/89 further specifies two overall TA objectives, to help the GOK to (1) improve its development planning, budgeting, and revenue generation processes, and (2) facilitate rapid private sector growth. These objectives will be achieved through activities in 5 areas -- sectoral policy analysis and planning, microcomputerization of the budget process, capital market development, CIP monitoring, and tax modernization. Provision will be made for related studies. (PD-BBR-630) PP amendment of 7/1/92 increases funding, to be allocated under 4 of the project"s components. (1) In the component to computerize the budget process, funds will be provided to help the Ministry of Finance (MOF) establish Computer System Support Units in the Budgetary Supply Department and the Directorate of Accounting Services; MOF staff will be trained and a budget systems manual prepared. (2) The capital market development component will receive additional support to educate the general public concerning Nairobi Stock Exchange offerings; efforts will include broker sales training, educational/promotional materials, and a modest advertising program. (3) For the tax modernization component, the project will finance some of the TA provided by the UNDP. (4) In the studies and evaluation component, additional computer equipment and TA will be provided to the Central Bureau of Statistics. (PD-ABI-105)