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China, Finland & 6 other countries Kenya owes the most amount of money

President William Ruto and China's President Xi Jinping
  • Kenya's debt is composed of both domestic and foreign components, each contributing substantially to the total figureKenya's total debt stood at Sh9.6 trillion, with domestic debt at Sh4.3 trillion and foreign debt at Sh5.3 trillion
  • External debt increased by 27.0%, showcasing Kenya's growing reliance on foreign loans
  • China's loans to the Kenyan government accounted for 70.2% of the bilateral debt, amounting to Sh 882.5 billion by June 2023

The Kenyan National Bureau of Statistics (KNBS) has unveiled its Economic Survey Report for 2024, presenting a comprehensive overview of the nation's economic landscape, including a detailed analysis of Kenya's national debt.

As of June 2023, Kenya's total debt stood at an alarming Sh9.6 trillion, reflecting significant fiscal challenges that the country faces.

Kenya's debt is composed of both domestic and foreign components, each contributing substantially to the total figure.

Domestic debt amounts to Sh4.3 trillion, which is held by investors in government bonds and other securities.

This domestic borrowing is crucial for funding various government initiatives and projects, although it also implies a substantial financial obligation towards local investors.

The remaining debt is attributed to international lenders, including various countries and financial institutions.

The report highlights that the total debt surged by 19.3% to reach Sh9,623.9 billion by the end of June 2023.

This significant increase was primarily driven by a 27.0% rise in external debt, showcasing Kenya's growing reliance on foreign loans.

A notable trend observed in the report is the changing proportion of internal and external debt.

Internal debt, as a share of the total debt, decreased to 45.2% by the end of June 2023, down from 48.5% at the same time in 2022.

Bilateral and multilateral debts have also seen significant changes. Bilateral debt increased by 13.7%, reaching Sh1,257.5 billion, while multilateral debt rose sharply by 38.0% to Sh2,654.9 billion.

Among the bilateral loans, China's financial relationship with Kenya is particularly noteworthy.

China's loans to the Kenyan government accounted for a substantial 70.2% of the total bilateral debt, amounting to Sh 882.5 billion by the end of June 2023.

The increasing national debt, particularly the substantial rise in external debt, poses several challenges for Kenya.

Managing this debt effectively will be crucial to ensure sustainable economic growth and to avoid potential financial crises.

The government may need to explore strategies for debt restructuring, enhance revenue collection, and foster economic policies that promote fiscal discipline.

Moreover, the reliance on external borrowing, especially from countries like China, brings to the forefront discussions on the geopolitical implications and the need for balanced foreign relations.

Below are tables showing countries, local and international organisations the countries owes:

Lending Country Amout in Sh Billion
China 882.54
Finland 727.04
Denmark 431.48
France 109.72
Japan 99.12
Belgium 25.6
Germany 44.75
U.S.A 1.6
Others 93.41
Lender June 2023 (in Sh billion)
IDA/IFAD 1.6
EEC/EIB 29.1
IMF 335.59
IDF/AfDB 517.89
Other Multilaterals 166.81
Commercial Banks 351.33

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