Friday, March 29, 2024

Kenya takes new Sh. 502 billion loans from EU

Despite public protests against debts that are spiralling out of control, the Jubilee government has signed a five-year €4.5 billion (Sh. 520 billion) loans and grants deal with the European Union (EU). The new agreement was signed between Treasury Cabinet secretary Henry Rotich and EU ambassador to Kenya Stefano Dejak.

It has added to Kenya’s heavy debt load that now stands at Sh. 5.146 trillion.

The €4.5 billion includes indicative financial commitments of the EU (€505.4 million), the European Investment Bank (€500.75 million), Denmark (€151 million), France (€1.412 billion) and Finland (€33.7 million). Others will be Germany (€638 million), Italy (€144.4 million), Ireland (€5.5 million), Slovak Republic (€2.5 million), Sweden (€114.8 million), Netherlands (€216.3 million) and the United Kingdom with €554 million.

Apparently, the new loans and grants are expected to contribute to President Uhuru Kenyatta’s Big 4 Agenda, whose applicability has come under criticism from some quarters.

“This agreement not only harmonises investment over a long period of time, it also aligns financial support with the priorities and objectives of the national government, such as the Government of Kenya’s Medium Term Plan III and the Big Four agenda,” the EU said.

Mr Rotich did not, however, disclose which proportion of the amount is loans and which one is grants.

The 19-member country bloc said it would to use the money to support Kenya’s lower middle-income status while addressing inequalities and challenges that persist across the country. Focus areas will be infrastructure, job creation, resilience building accountability and governance.

Mr Rotich, said the money would also help the country in addressing the flooding menace as well as drought management through irrigation.

“The support we have received will help the country in improving its economy. As you know, the country has many infrastructure deficit projects,” he said.

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