Kenyans unhappy with spiralling debt patterns
Lewis Nyakundi and Bernard Gitau
A vast majority of Kenyans are unhappy with the country’s debt levels, a survey has shown.
This comes at a time when all indications show that the Sh9 trillion debt ceiling is likely to be lifted to enable the government borrow more.
As of February, Kenya’s debt stood at Sh8.58 trillion according to the Director General of Treasury’s Public Debt Management Office, Haron Sirima (above).
President Uhuru Kenyatta assented to the supplementary appropriations bill paving way for the government to borrow Sh125 billion to supplement the 2020/21 budget.
Saddled with debt
In a survey released yesterday by Infotrak, 81 per cent of the respondents said they feel anxious, angry or fearful about the level of Kenya’s debt.
“Kenyans from the regions of Nyanza, Eastern, Western, and North Eastern are the most anxious about the level of Kenya’s foreign debt,” said Walter Nyakundi, a research manager at Infotrak.
“A majority of Kenyans feel that the regular borrowing from foreign countries is not a good thing,” he added.
“Only 12 percent of the 800 respondents said the government is properly using the loans,” said Nyakundi.
Over a third of Kenyans(38 per cent) fear that future generations will be saddled with this debt and will repay it for a long time while another 34 per cent fear that the country will default on loan repayment resulting in an embarrassment.
There are also fears that the country could lose its strategic resources facilities and installations to foreigners.
Additionally, 52 per cent of Kenyans rated the government’s handling of foreign debt as poor while another 62 per cent said they do not think regular borrowing from foreign countries was a good thing.
Rift valley province has the highest percentage of people opposed to the country taking foreign loans at 69 per cent followed by coast and rift valley at 67 and 66 per cent respectively.
Over half of the population in Western, Coast, Central Nairobi, and Eastern said they feel the government has handled the debt poorly, according to the survey.
The survey was conducted between December 20 and December 23 last year and involved 829 respondents drawn from all the former eight provinces.
According to the 2021 Budget Policy Statement, Kenya’s public debt as of June 2020 stood at Shs 7. 06 trillion, equivalent to 65 per cent of GDP.
The Treasury in its Medium-Term Debt Management Strategy 2021 disclosed that it will be tabling changes to the Public Finance Management law for approval by legislators in the near future to raise the cap on debt, without disclosing the fresh limit it is looking at.
The ceiling was last raised from Shs 6 trillion in 2019, reflecting growing borrowing due to gaping budget deficits and investments in infrastructure projects like roads.