The latest report on commercial loans borrowed by the Kenyan government does not give for good reading to the country’s economy.
Worry as Kenya's costly loans double in 10 months
Commercial loans have sharply increased by Sh92 billion between July 2016 and April 2017 compared to same period previously.
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This is after Treasury CS Henry Rotich revealed that commercial loans taken by the government more than doubled in 10 months financial year 2016-17 compared to a year earlier.
In the Statement of Actual Revenue and Net Exchequer Issues report released by Mr. Rotich, loans between July 2016 and April 2017 rose to Sh167.14 billion from Sh74.33 billion in the same period before. This reflects a sharp increase of Sh92.81 billion (124 per cent).
The country’s elevation to lower middle income economy status in September 2014 has seen it resort to borrow more commercial and semi-concessional loans as concessional loans, largely from World Bank Group's International Development Association, have been declined.
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The Kenya Revenue Authority collected Sh989.94 billion between July and April this financial year, the data shows, a growth of 11.46 per cent, or Sh101.82 billion, compared to Sh888.12 billion total tax collected the year before.
The tax collected made up for 63.33 per cent of the Sh1.5 trillion total revenue the government made in the period of July 2016 to April 2017 reflecting a 10 per cent increase from the Sh1.415 trillion generated in the first 10 months of the 2015-16 financial year.
The Treasury has failed to meet its revenue generation target mainly due to shortfalls in income tax as well as collections from fees, charges, court fines and investment income and Imports Declaration Fee.
The report comes amid worry over Jubilee’s borrowing frenzy which has seen Kenya’s public debt increase to a huge Sh4 trillion as of March 2017.
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That means each Kenyan owes creditors at least Sh86,596…and the number keeps growing.
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