The Kenya Kwanza government has borrowed a hefty sum of Ksh223.5 billion in just five months, according to a report released by the National Treasury.
This report, presented to Parliament, outlines that the government secured 11 loans between September 1, 2023, and January 31, 2024.
This no doubt raised eyebrows among Kenyans considering that the president, during his campaigns vowed he would not take loans like his predecessor. The Kenya Kwanza government has been on record on numerous occasions blaming the current economic woes on loans by the previous administration.
According to the Treasury report, the loans taken by Ruto’s government were meant to improve financial viability of Kenya Power and increase access to electricity. They were also meant to increase employment, earnings, and promote savings for targeted youth at national scale. Below is a breakdown of some of the loans:
- Economic Development and Welfare: The government secured a loan of Ksh5.8 billion from the OPEC Fund to bolster the economic potential of Kenya’s North Eastern region and uplift the socio-economic welfare of its inhabitants. The project aims to create job opportunities through improved transportation and market access.
- Youth Empowerment: Another loan of Ksh14.2 billion from the International Development Association (IDA) was directed towards the National Youth Opportunities project, intending to boost employment, earnings, and savings for targeted youth groups.
- Energy Sector Enhancement: Ksh28.5 billion was borrowed to support the Kenya Green and Resilient Expansion of Energy Program, aimed at improving Kenya Power’s financial viability and increasing electricity access.
- Revenue Mobilization and Accountability: The government secured Ksh36.9 billion to bolster revenue mobilization efforts and deepen transparency and accountability in public finance management at the national level.
- Infrastructure Development: Ksh4.3 billion was allocated to enhance access to irrigation water, strengthen institutional frameworks, and build capacity for water security and climate resilience in certain areas.
- Health Sector Strengthening: Additionally, Ksh17 billion was directed towards strengthening the resilience of the health system and enhancing preparedness and response to health emergencies.
These loans also include a Syndicated Term Loan Facility of Ksh30.6 billion, which serves various purposes including funding development projects and refinancing of Eurobonds.
Through these loans, Ruto’s government had pledged to address key areas of development such as employment generation, energy access, infrastructure enhancement, and health sector strengthening.
However, questions will definitely abound on how the government spent this money. There have been concerns over huge and ‘unnecessary budgetary allocations towards renovation of the state house at a time when Kenyans are grappling with a high cost of living.
Deputy President Rigathi Gachagua’s office was also put on the spot for buying curtains and furniture worth Ksh 18 million.
