Treasury Confirms Looming Debt Crisis Due to Fiscal Deficits

Treasury CS John Mbadi has confirmed a looming debt crisis brought by fiscal deficits resulting from continuous borrowing by the government. Speaking today on a national radio, Spice FM, Mbadi revealed Kenya has until October 2025 to settle Ksh.161 billion of it’s debts.

While expounding on figures amounting the aforementioned debt, the CS explained that this huge figure has resulted from Eurobond and syndicated loans, further stating that Kenya looks forward to paying a total Ksh.116 billion Eurobond by May 2027, payable in three equal installments annually.

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Mbadi also detailed out that Kenya’s syndicated loans amounts to Ksh.952 million, ought to be paid in eight months.

“In September we are supposed to pay Ksh.25.8 billion to the Trade and Development Bank, another Ksh.10 billion and also Ksh.83.5 billion. Add another Ksh.3.4 billion, and that gives you Ksh.123 billion by October,” he told explained.

“This is besides the Eurobond (Ksh.38 billion needed in 2025). That is the kind of pressure we’re in.” He added.

Pointing out on Kenya’s necessity to balance it’s domestic and foreign debts, Mbadi explained that Kenya must keep the ratio of the two equally balanced to avoid exposing taxpayers to fluctuation in interest rates.

“Domestic borrowing is almost balancing 50/50. Right now, we have almost Ksh.5.6 trillion in domestic borrowing and about Ksh.5.1 trillion in foreign debt,” he said.

His statement came, even as he tries to back his ministry saying they are making efforts to improve Kenya’s economy.