Emery added that the move was likely to expose the Kenyan counties to capture by IMF and other creditors to an extent of appointing administrators and placing them under receivership the same way Greece was placed under receivership. Unlike previous debt crises where the IMF and the World Bank played a leading role, this time the creditors are mostly commercial entities or state financial organisations. Government Debt to GDP in Kenya is expected to reach 65.00 percent by the end of 2020, according to Trading Economics global macro models and analysts expectations. Monday, 22 February 2021. The Kenyan Social movements under the banner of the Kenya Debt Abolition Network [1] (KDAN) in collaboration with the Committee for the Abolition of Illegitimate Debts (CADTM), held an online Debt Dialogue on Zoom on 13 January 2021 to discuss the … Kenya’s risk of external debt distress remains low, while overall public sector debt dynamics continue to be sustainable. 10Y. On his part comrade Eliud Emery of TUBAE also a member of KDAN presented on the devolution of Debt in Kenya noting that it was a potential for Capture of the Kenyan Counties. He condemned the Kenyan government for bowing down to the pressure from the IMF to include Sh3.4 trillion parastatal and county loans as part of the country’s national debt[4]. Public debt sustainability indicators already demonstrate Kenya faces a high risk of debt distress. Total public debt as at December 2017 hit high levels - at Sh4.6 trillion and still counting. This has been mainly caused by years of … The country is staring an effective student debt crisis in the short-run as Kenyan university students bear considerable weight of loan repayments. It is now clear that Kenya is headed straight into debt crisis headwinds, and it's an appointment it cannot avoid. The Zoom dialogue was attended by representatives from Kenyan Peasants League (KPL) Turkana Bia Aloe Organization (TUBAE), Center for Rights Education, Governance and Democracy (CREGD), Wote Youth Group, Up and Front Jiinue CBO, Kangemi Grassroots Human Rights Movement, Kakamega County CSOs Network and Baringo County CSOs Forum all members of the KDAN. There is something ominous about Kenya’s debt. The Treasury CS has assured Kenya is not facing any debt servicing crisis at a time when the country’s debt portfolio is expected to breach the 7 trillion shillings mark this year. [email protected], Kenya staring at debt crisis - Controller of Budget. Organizations, 200 000 000 + The main issue is that this crisis comes when debt sustainability has already been under pressure for some time. The meeting was structured into two sections with the first section being for presentations while the other section being for plenary. Kenyan debt unsustainable and has reached a crisis level – says Kenyan Peasants League. Various forms of governments finance their expenditures primarily by raising money through taxation. African debt crisis worsened within the mentioned period when the external debt to gross domestic in Sub-Saharan product ratio jumped from (51% in 1982 to 100% in 1992, … As this was happening, the Paris Club announced that they had entered a debt suspension agreement with Kenya. [2] Business Daily, Kenya Bows to IMF Pressure on Public Debt Disclosure. Available from:. Kenya’s current public debt … There were two discussants who made presentations on two different topics as follows; Cidi Otieno the National Coordinator of KDAN on the Kenyan Debt Crisis – Building a Case for the Abolition of Kenyan Debt and Eliud Emery of TUBAE on the Devolution of Debt in Kenya – Potential for Capture of Counties? Furthermore, it does not address the legality, legitimacy and sustainability of debts which is key issue that KDAN is pursuing. He wondered how majority of Counties in Kenya that have consistently failed to meet their revenue targets whose source has mainly been raising own resources using taxes, levies and fees could repay the debts. The study investigates the effect of public debt on economic growth in Kenya, between 1980-2013.The choices of period was guided by data availability and escalation of Kenya’s public debt. By the end of December 2020, Kenya's debt had grown to Sh7.2 trillion, which is equivalent to 65.6 percent of the GDP. Kenya's debt crisis is not just due to debt-GDP ratio but other factors such as deficit spending, poor revenue generation and outright theft. It is against such background that KDAN decided to host the first part of a series of Zoom Dialogues that shall take place fortnightly with an aim of highlighting the Kenyan debt crisis and that shall ultimately plan actions aimed at calling for a Citizen Debt Audit aimed at leading to abolition of those portions of Kenyan debt that are illegal, illegitimate and odious. On 13 January 2021 the Kenya Debt Abolition Network (KDAN) which is a social movement of Kenyan individual and organization whose main aim is to call for Abolition of Kenyan Illegal, Illegitimate and Odious Debts through evidence based processes like Citizen Debt Audit and calling for public participation in the process of incurring Debts with support from the Committee for the Abolition of … Rwanda’s public debt tally was $5.4 billion by 2018, having risen from $4.8 billion the previous year, according to a World Bank report released in October. According Treasury’s Draft Budget Review and Outlook Paper, Kenya is expected to incur an extra KES1.82 trillion in loans for the next two years i.e. [20 January 2021]. 7.1 trillion from a flat Sh. The loan is to be repaid in 30 instalments between January 2021 to July 2035. [3] Citizen Digital, China says it is ready to help Kenya deal with its debt challenges. Haile Selassie Avenue P.O Box 60000 - 00200 Nairobi, Kenya +254 20 286 0000 +254 20 286 … Evans Habil/Nation Media Group. The roots of Africa’s new debt emergency grew out of the US financial crisis a decade ago. Kenyan Debt. Cidi stated that the Kenyan borrowing needs to be audited based on the principles of public finance management, if the Kenyan debts had such conditions and policy prescriptions, that violate national laws and human rights standards,  if the lenders issued loans to Kenya fully aware that Kenya could not service the loans without seriously impairing the ability or capacity of the Kenyan Government to fulfil its basic human rights obligations or if there are portions of Kenyan debt that were incurred not in the interests of the people or the state but in the personal interest of the leaders or persons holding power. This coming March on the 8th, the International Women’s Day, organized in our diversity and… Read more →, 182 Key Debt Statistics: Kenya’s gross public debt increased to about 61.7% of gross domestic product at end-2019, from 50.2% at the end of 2015, the … up to June 2022 effectively pushing Kenyan Debt KES8.06 trillion. External Debt in Kenya increased to 3793.29 KES Billion in December from 3771.81 KES Billion in November of 2020. source: Central Bank of Kenya. China on the other hand through their embassy in Nairobi announced that China and Kenya were holding talks over debt service suspension[3]. It is worth noting that debt service suspension does not address the debt crisis or the problem of incurring more debts as it just postpones the problem. 22 February 2021. Breaking Kenya News. Debt crisis is a situation in which a government (nation, state/province, county, or city etc.) Emery concluded that the move could see the National Government taking over management of counties that shall be unable to repay the loans in a similar fashion which the Nairobi Metropolitan Services was created ending up killing devolution. While Kenya is one of the countries that responded quickly to the current pandemic by implementing a lockdown, the ongoing crisis is expected to have a large impact, even as the number of recorded covid-19 cases remains limited. China stands ready to help Kenya deal with its debt challenges and both sides are holding "smooth" talks over the issues, the Chinese embassy in Nairobi said on Monday. Kenya’s stock of debt zoomed past the Sh. Home NEWS Inside Tuskys’ spying system, theft syndicate and debt crisis. Controller of Budget Margaret Nyakango takes oath of office at the Supreme Court on December 4, 2019. fears Kenya would default on its loans, citing a projected repayment plan for 10 years. The fear is that should the County be included as national debts, then the next step will be capture of the counties by the international creditors which might see them privatized just like some parastatals should the counties fail to repay the debts on time. 10 February 2021 Capitalism and Free Trade, South and East Africa. Ultimately, the article examines the external debt situation in Kenya and how Chinese loans are likely to precipitate a crisis of sustainability. Kenya's debt servicing cost to … Tuskys Supermarket on Kenyatta Avenue in Nairobi (file photo). During the Covid 19 pandemic period, the Kenyan debt situation worsened as the Kenyan government incurred more Debts in the name of responding to the Coronavirus Pandemic. The meeting was also motivated by the fact that despite the Kenyan debts being unsustainable, Kenyan government appetite for Debts seems to be increasing unmitigated. In the long-term, the Kenya Government Debt to GDP is projected to trend around 69.00 percent in 2021 and 73.00 percent in 2022, according to our econometric models. On 11 June, the government presented a KES 2.79 trillion (around USD 26 billion) budget for fiscal year 2020–2021, which will start on 1 July and run through to 30 June 2021. Home » Kenyan debt unsustainable and has reached a crisis level – says Kenyan Peasants League, 10 February 2021 Capitalism and Free Trade, South and East Africa. President Uhuru Kenyatta warned international development agencies, and the U.S. and Europe on Friday against using Kenya’s current debt crisis as a pretext to lecture the country and interfere in its affairs. Despite repeatedly insisting that Kenya’s public debt that currently stands at $50 billion and is projected to hit $60 billion by 2020 and $70 billion in 2022 is within sustainable levels, challenges in settling maturing syndicated loans has exposed the burden facing Treasury in debt management. The Kenyan Social movements under the banner of the Kenya Debt Abolition Network[1] (KDAN) in collaboration with the Committee for the Abolition of Illegitimate Debts (CADTM), held an online Debt Dialogue on Zoom on 13 January 2021 to discuss the Kenyan Debt Crisis. Get a daily email packed with the latest China-Africa news and analysis. #8M2021 Against the Virus of Patriarchy and Capitalism, the Vaccine of Feminism and Solidarity. Kenya is weighed down by swelling public debt and faces the possibility of a debt crisis (where the government can’t repay what it owes). According to Cidi Otieno, the National Coordinator of KDAN and also the Secretary General of the Kenyan Peasants League, a member of La Via Campesina, the debt “has now reached a crisis level and has simply become unsustainable”. [1] aim is to call for Abolition of Kenyan Illegal, Illegitimate and Odious Debts through evidence-based processes like Citizen Debt Audit and calling for public participation in the process of incurring Debts. And they have little appetite for write-offs or restructurings. Furthermore, Kenya is supposed to start repaying the Chinese Loans that was used to construct the Nairobi – Naivasha Standard Gauge Railway from January 2021 which is going to add to the Kenyan taxpayers’ burden. News that Kenya had bowed to International Monetary Fund (IMF) pressure to include Sh3.4 trillion parastatal and county loans as part of the country’s national debt[2] just worsened the situation by exposing the Kenyan Counties as another frontier for the Debt colonization and capture. Kenya is presently staring at a debt refinancing crisis as it deploys half of its tax revenues in the 2020/21 financial year to repay debt. CoB warns that Treasury penchant of borrowing to meet deficits is recipe for trouble. Kenya - Public Debt Government unveils FY2020 budget against Covid-19 backdrop; sets a trajectory for consolidation. The move is set to increase the Kenyan Debt from the current KES7 trillion to KES10.4 trillion passing the KES9 trillion set by parliament. Available from:. The total national debt exceeds over Kenyan shillings (KSh) 5 … Inside Tuskys’ spying system, theft syndicate and debt crisis loses the ability of paying back its governmental debt.When the expenditures of a government are more than its tax revenues for a prolonged period, the government may enter into a debt crisis. Likewise, Kenya’s borrowing spree has increased the accumulation of new debts with signs that the country’s capacity to repay the loans could be impaired, eventually leading to debt crisis. 7 trillion mark in August wounding up at Sh. In September last year, Kenya’s debt servicing cost to export ratio crossed the IMF-recommended threshold of 21 percent for the first time. The dialogue recommended conducting fortnightly Zoom Dialogues on Kenyan Debt with a view of creating more awareness on the Kenyan Debt Crisis and planning popular actions against the debts; creation of KDAN Website where all information regarding all Kenyan Debts and those incurred by the Counties can be accessed by all and sundry; reviewing all the Kenyan debts since independence and make them public on the KDAN website; conducting an assessment of County Debts incurred so far; advocating for formation of a Kenyan Citizen Debt Audit Commission to audit all Kenyan debts; producing assessment reports on specific debts that Kenya has incurred; using the week before the International Women Day in March to raise issue of Microcredit and their relationship with the neoliberal policies of IMF and World Bank; petitioning National and County Governments to provide details of all loans incurred based on the Citizen Debt Audit questions and following up on the issue of Dominion Farms in Siaya County with the Siaya County Government. 1 However, margins have generally narrowed, and standardized stress tests suggest that the vulnerability to export shocks has increased. This is not withstanding the fact that the Treasury’s Draft Budget Review and Outlook paper stating that Kenya expects to incur an extra KES1.82 trillion before June 2022. The Paris Club announced that it had agreed to offer Kenya a time bound suspension of debt service from 1 January 2021 to 30 June 2021with a condition that the freed resources on this initiative will go to mitigate health, economic and social impacts of covid 19 pandemic. Cidi concluded by asking Kenyans to ask for the establishment of Citizen Debt Audit Commission to establish for what purpose was the debt incurred, who decide to contract those Loans on behalf of people of Kenya, whether Kenya received the entire amount, who the lenders are, who holds the debt, who has profited from the Kenyan debt, what interest has been paid and at what rate, whether there are private debts that have become public debts, what portion of the state’s budget is being used to service the debt, what were the creditors’ conditions, how the Kenyan government finances debt repayments and the social, economic, gender, regional, ecological effects of the loans and its impact on peoples. [20 January 2021]. Public debt sustainability indicators already illustrate that Kenya faces a high risk of debt distress. The loan maturity comes at a time when Kenya is facing a budget shortfall due to coronavirus and spiraling debt that has hit KES7 trillion or 62.5% of the economy. Peasants, Kenyan debt unsustainable and has reached a crisis level – says Kenyan Peasants League, https://www.businessdailyafrica.com/bd/economy/kenya-imf-pressure-on-public-debt-disclosure-3253020, https://citizentv.co.ke/news/china-says-its-ready-to-help-kenya-deal-with-its-debt-challenges-4597399/. With Kenya already struggling to service the current loans including to borrow more to service the existing loans, allowing the Counties to borrow more will expose the Kenyan Counties especially those with natural resources to privatization of mines, water sources, land, farming; privatization of county services and opening up of counties to Multinational corporations investments that shall in turn kill local industry and investments.

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