Kenya’s $60b debt blamed on Treasury’s opaqueness

The Kenyan Parliament has directed the National Treasury to submit the list of projects to be financed through debt. This, parliamentary Budget and Appropriations Committee (BAC) argue, will lift the lid of secrecy surrounding the utilisation of borrowed funds.

The (BAC) has accused Treasury of being opaque on the specific use of debt proceeds on Wednesday demanded a list of all projects as a condition to approve the 2020/2012 budget.

Kenya’s public debt is gravitating towards the $60 billion mark, blamed on the high levels of opaqueness Treasury deploys when borrowing and failure to reveal planned use of the proceeds.

All along, Treasury has maintained the borrowed resources go towards budgetary support and financing of unspecified development projects, mainly large infrastructure projects.

Now parliament is demanding clarity in terms of projects that Treasury intends to finance through debt.

In its report on the 2020 Budget Policy Statement tabled in the House, BAC said that Treasury must provide adequate information on debt, clearly indicating the amount of concessional, semi concessional and commercial loans as well as outlining the country’s borrowing strategy.

Treasury must provide the information before the Budget Estimates for 2020/2021 financial year are submitted to Parliament by April 30th.

Parliament also want Treasury to develop criteria for identifying and isolating core priority programs under the Big 4 Agenda in order to protect them from ad hoc expenditure cuts.

The target is to reduce fiscal deficit from 7.7 per cent of gross domestic product 2018/19 to 3.3 per cent by 2023/24.