There’s Good News and Bad News About Kenya’s Ballooning National Debt

After Angola and Zambia, Kenya is high on the list of countries at risk of encountering severe debt distress due in part to extensive borrowing from China to fund major infrastructure projects like the Standard Gauge Railway and, more recently, its seemingly insatiable appetite for more debt. 

In August, Kenya’s national debt broke the psychologically important Sh7 trillion barrier with external debt growing by 15.6% in the March to August period of this year alone.

Kenya’s Borrowing at Lower Rates But Its Weakening Currency Makes Everything More Expensive

  • COST OF BORROWING: Taxpayers forked out $5.9 billion to service Kenya’s public debt in the year to June 30, a report by the Treasury shows, marking a 23% drop from the previous year. “The decline of debt service was on account of decline to lower repayment of commercial debt,” Treasury Cabinet Secretary Ukur Yatani said in the annual public debt management report to Parliament. (BUSINESS DAILY)
  • KENYA’S TUMBLING CURRENCY:  The annual interest on Kenya’s dollar-denominated debt rose by $83 million yesterday after the shilling dropped significantly against the greenback. At least 70% of Kenya’s debt is denominated in US dollar. (THE STAR)
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The post There’s Good News and Bad News About Kenya’s Ballooning National Debt appeared first on The China Africa Project.



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