In a record-setting fiscal year, Kenya's public debt soared to Ksh11.14 trillion ($76.83 billion), marking an unprecedented increase of Ksh1.93 trillion ($13.3 billion) by the end of 2023. This surge is attributed to a combination of factors including multilateral loan increments, a depreciating Kenyan Shilling, and escalating living costs. The East African powerhouse witnessed a daily debt uptick of Ksh5.29 billion ($36.5 million) throughout the year, with external public debt, constituting 73% of the total rise, being significantly impacted by the currency's decline.
The Treasury's quarterly economic and budget review highlighted a shift in the debt composition, with external and domestic debts representing 54.7% and 45.3%, respectively. Notably, external public debt expanded by Ksh1.416 trillion to Ksh6 trillion, while domestic debt grew by Ksh514.48 billion, reaching Ksh5 trillion. The landscape of international borrowing saw multilateral loans, primarily from the World Bank and IMF, increase by $1.62 billion, whereas bilateral loans experienced a reduction of $692.72 million.
"The increase in the public debt is attributed to external loan disbursements; exchange rate fluctuations; and uptake of domestic debt during the period," the Treasury explained, underscoring the multifaceted drivers behind the year's debt dynamics.
Source: africa.businessinsider.com