ndindi nyoro
Former Budget and Appropriations Committee Chairperson Ndindi Nyoro has warned that Kenya will soon be forced to default on its loans.
Speaking during the annual budget review, the Kiharu Member of Parliament said the public debt, which is now estimated at Sh11 trillion, is spiraling out of control, and any move to renegotiate it could trigger even worse economic fallout.
“Any indication that we are going to default or are unable to service our loans is more catastrophic to our economy,” Nyoro said.
The country is already spending over a trillion shillings just to service loan interests, and the government is quietly reaching out to China for debt restructuring.
President William Ruto is set to travel to China at the end of April, with speculation rife that discussions about the country’s debt challenges could take place.
Kenya’s debt crisis is no longer just a theory, it’s a daily reality for millions. Prices continue to soar, taxes are suffocating the economy, businesses are grinding to a halt, and the government is still borrowing just to stay afloat.
Experts warn that if Kenya defaults its loans it will be in a more fragile position than Countries like Zambia and Ghana, which already defaulted because of a heavier debt load and higher interest payments.
Since President Ruto came to power, Kenya’s debt has gone up from Sh8.7 trillion to Sh11.02 trillion in just 937 days.
That means the government has been borrowing at the rate of 902 billion per year, 75.9 billion per month, and 2.48 billion every single day.
Meanwhile, Nyoro also admitted that the government’s move to increase taxes since 2022 has had the opposite effect by discouraging spending and investment, leading to even lower revenues.
“Increasing taxes to get more revenue is a fallacy. By increasing taxes, you distort economic decisions. If I was planning to buy a car, I would withhold that decision because the government is coming for my money. That means even the little revenue you would have gotten you won’t get it,” said Nyoro.
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