The East African Development Bank (Amendment) Bill, 2026

Background

The principal objective of the East African Development Bank (Amendment) Bill, 2026 is to amend the East African Development Bank Act (Cap. 493A) to enhance legislative oversight and public accountability. Under the current principal Act, the Cabinet Secretary responsible for finance is authorized to disburse and commit public funds from the Consolidated Fund to the Bank without seeking prior approval from the National Assembly. This Bill amends those provisions to align the funding mechanisms with the principles of public finance under the Constitution of Kenya.

Key Amendments

The Bill introduces critical changes to both the financial provisions of the principal Act and the Treaty Charter annexed to it:

• Section 2 Replacement: Replaces the financial provisions of Cap. 493A, subjecting all payments out of the Consolidated Fund to the Bank to parliamentary appropriation and external budget approvals.
• Creditor Status (Article 24 of the Schedule): Grants the Bank a preferred creditor status within Member States equal to that of the International Monetary Fund (IMF), the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the African Development Bank (ADB), and the African Development Fund.
• Judicial Proceedings (Article 44 of the Schedule): Enacts absolute immunity from legal processes for the Bank unless it has expressly waived its immunity in writing and has a physical office and appointed agent in the Member State where the lawsuit is brought.
• Asset Protection (Article 45 of the Schedule): Immunizes the Bank's property, premises, and assets from search, confiscation, expropriation, nationalization, or foreclosure by any executive, legislative, judicial, or administrative authority before a final judgment is delivered by the highest court of competent jurisdiction.

New Obligations

The Bill places several explicit administrative and reporting obligations on the Cabinet Secretary responsible for finance:

• Budget Alignment: The Cabinet Secretary must ensure all disbursements to the Bank are authorized via an Appropriation Act and validated by the Controller of Budget.
• Legislative Reporting: The Cabinet Secretary is required to submit a detailed report of all Consolidated Fund payments made to the Bank to the National Assembly within three months of the end of each financial year.
• Loan Approvals: Before creating or issuing securities or raising loans to fund payments to the Bank, the Cabinet Secretary must obtain the approval of the National Assembly.