Mutahi Kagwe: Donor Cash Must Deliver Impact, Not Just Flow

By Benadeta Mwaura - Reporter

Kenya, December 17 2025 - Kenya’s leadership is sending a clear message to development partners: foreign financing must translate into tangible benefits for citizens, even as global aid flows are restructuring and traditional donors reassess their commitments.

Agriculture Cabinet Secretary Mutahi Kagwe said donor support should be treated with discipline and aligned with national priorities rather than seen as “free money,” emphasising that externally financed projects must deliver measurable results for farmers and the wider economy.

Speaking at a Joint National Project Steering Committee meeting for World Bank financed agriculture programmes, Kagwe underscored the need for well structured, citizen driven initiatives anchored in sound policy. “Donor financing is not free money. These are loans, and we must be honest about that. Every facility must align with our agenda and produce results for farmers and this country,” he said, stressing prudent alignment with Kenya’s development goals.

Kagwe specifically noted that even projects aimed at boosting production and value addition, such as the recently approved Livestock Value Chain Support Project, must be carefully planned and executed to ensure they improve productivity, cut postharvest losses and raise incomes in ways that support local industry.

He also raised concerns about procurement choices in project plans, urging authorities to source goods locally where possible to maximise economic impact. The call for accountability comes against the backdrop of evolving global aid dynamics. Traditional donor funding, particularly from the United States, has shifted in recent months, with notable impacts on Kenya’s health sector.

Under the America First Global Health Strategy, much foreign assistance previously channelled through institutions like the U.S. Agency for International Development (USAID) has been reorganised, reduced or paused in some areas, affecting lifesaving treatment availability.

Cuts to U.S. aid have disrupted access to essential nutrition and healthcare commodities, including readytouse therapeutic food for children in Kenya’s drought affected regions, and temporarily suspended supplies of antiretroviral drugs and other Essential Medical Supplies managed through the Kenya Medical Supplies Authority (KEMSA).

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Still, the U.S. and Kenya have pivoted toward a new model of cooperation. In early December, President William Ruto oversaw the signing of a historic government to government health cooperation framework with the United States. The pact, valued at approximately $1.6 billion (about Sh208 billion) over five years, directs U.S. funding straight into Kenyan government health systems, including the Social Health Authority, Digital Health Authority and Kenya Medical Supplies Authority, rather than relying on intermediary NGOs.

Under the arrangement, the U.S. will continue to support HIV, tuberculosis and other priority health programmes, but with the expectation that Kenya will gradually increase domestic financing and eventually absorb full responsibility for core health services by 2031.

In his address at the signing, President Ruto said the framework aligns with Kenya’s Universal Health Coverage agenda and emphasises efficiency, accountability and selfreliance. “Every shilling and every dollar will be spent efficiently, effectively and accountably,” Ruto stated, highlighting the shared commitment to stronger, more sustainable health systems.

The shift reflects a broader reorientation in aid relationships, where donor countries are increasingly insisting on outcomelinked funding and greater recipient ownership. Critics of abrupt funding reductions warn that such shifts can jeopardise progress in areas like HIV treatment, maternal health and child nutrition, especially where donor support has historically filled critical gaps.

Analysts have cited figures showing that U.S. contributions through initiatives like PEPFAR once accounted for significant portions of Kenya’s HIV programme financing, and their reduction has forced tough adjustments in national health budgets and service delivery.

For Kenyan policymakers, the evolving aid landscape reinforces Kagwe’s insistence that external financing should be treated as part of the country’s broader economic strategy rather than a stopgap. By framing donor funds as structured, measurable investments rather than openended assistance, officials aim to foster greater accountability, support local industry through judicious procurement, and align foreignfunded projects with Kenya’s longterm development priorities.