This archive report was first published on 16 October 2019.
Kenya's economy is on the brink of collapse, according to Musalia Mudavadi, the leader of the Amani National Congress (ANC) party. In a recent speech at a parliamentary by-election campaign rally in Kibra, Nairobi, Mudavadi warned that the country's appetite for expensive loans will plunge it into economic anarchy.
Speaking on October 15, 2019, Mudavadi criticized Parliament's decision to raise the borrowing ceiling to Sh9 trillion ($85.7 million), calling it 'unjustifiable.' He noted that the figure was arrived at without any clear justification, and that even some Members of Parliament had raised questions about the issue.
'It was unfair for a parliamentary committee to approve and increase debt ceiling from Sh6 trillion to Sh9 trillion when they cannot tell Kenyans how they arrived at the magical figure,' Mudavadi said.
A World Bank report released on October 9, 2019, had warned that Kenya is drifting towards debt distress, owing to the Government's huge appetite for high-interest loans. Mudavadi claimed that even before the dust on new borrowing had settled, the Treasury Cabinet Secretary had already made commitments to travel to Washington DC to negotiate with the IMF and World Bank to borrow more money.
'Now they have realised their mistakes of borrowing money with high interest rates. This time around, they are rushing to IMF and World Bank to borrow at lower interest rates. I have been a minister for Finance. Those arrangements will come with sanctions,' Mudavadi said.
Mudavadi also criticized the Nairobi County Government Planning department for failing to approve architectural designs and construction worth Sh8 billion that had been submitted by various designers since June.
