Kenya's appetite for loans sees each Kenyan owed at least USD100
Of the Sh741 billion Kenya owes 13 countries in commercial loans, China is leading the pack with Sh534 billion.
Although Treasury documents tabled in the National Assembly put the debt at Sh4.9 trillion as at June 2017, by February this year, the country had borrowed another Sh220 billion largely for infrastructure development and electricity connection, effectively pushing Kenya’s public debt to past the Sh5 trillion mark, meaning that every Kenyan now owes the lending institutions at least Sh110,000.
The bulging debt reflects the Jubilee administration’s appetite for loans notwithstanding their accumulation with fears that the borrowing may not be sustainable.
“The public debt is manageable as long as the economy is growing. One question one needs to ask; is the debt growing more than the country’s economic growth? If the economy is not growing then there is a problem,” Treasury Cabinet Secretary Henry Rotich said after unveiling the Sh3.074 trillion budget for the 2018/19 financial year, trying to downplay fears over the ballooning public debt.
Currently, the Kenyan debt to Gross Domestic Product (GDP) ratio is at 50 per cent.
Kenya’s foreign debt now stands at staggering Sh2.54 trillion after government signed a new Sh47 billion loan with French Development Agency.
Of the Sh741 billion Kenya owes 13 countries in commercial loans, China is leading the pack with Sh534 billion. Kenya owes France Sh64.8 billion, Japan Sh51 billion and Germany Sh26 billion. About Sh3 billion and Sh478 million is owed to the US and United Kingdom, respectively.
The World Bank is owed Sh508.9 billion while the Africa Development Bank is asking Sh206.3 billion.
JOIN OUR PULSE COMMUNITY!
Eyewitness? Submit your stories now via social or: