The Kenya government took a Sh. 32 billion loan in order to buy weapons. This is according to a report appearing in a local daily. This loan was part of the foreign debt that increased Kenya’s foreign loans by H. 270 billion.
“A fresh report tabled in Parliament last week shows the additional loans were spent on purchase of military jets, expansion of the naval base, building of a second international runway as well as purchase of CT scans for the country’s health sector,” the Business Daily reports.
“The new loans have pushed up Kenya’s total external debt to Sh2.52 trillion.
Kenya’s public debt recently crossed the Sh5 trillion mark for the first time, pointing to a looming increase in debt servicing obligations, including interest and principal repayments.”
Since coming to power in 2013, the Jubilee government led by President Uhuru Kenyatta has been on a borrowing spree that has left the country reeling from a Sh. 5 trillion debt.
Strikingly, the purchased weaoins are not expected to directly contribute to increased tax collections needed for repaying the expensive debts.
“The Treasury says it signed a Sh. 203.2 billion international sovereign bond and nine new loans worth Sh. 67.4 billion between November 1, 2017 and February 28, 2018. Treasury data submitted to Parliament shows that proceeds of the Sh. 203.2 billion international sovereign bond has been received by Kenya,” says the paper.
In a report to Parliament detailing all new loans contracted by the government of Kenya, CS Henry Rotich says: “Disbursements from the loans are expected over the medium term. None of the loans have been disbursed; however the international sovereign bond is fully disbursed. This brings the total external debt disbursed to Sh. 2,524,530,791,430.”
