This archive report was first published on 18 November 2019.
Kenya's Treasury spent Sh81.06 billion more on debt repayments in the first four months of the current financial year than a year ago, largely driven by dues to domestic creditors.
According to the Statement of Actual Revenues and Net Exchequer Issues, debt repayments took up Sh276.17 billion in the July-October period, a 41.55 percent jump from Sh195.11 billion in the same period a year earlier.
Acting Treasury Cabinet Secretary Ukur Yatani noted that the amount spent on servicing public debt is equivalent to 55.42 percent of the Sh498.32 billion the Kenya Revenue Authority netted from taxpayers in the period.
Analysts at Genghis Capital pointed out that the period was marked with increased maturities in short-term debt with a repayment period of between three months and one year.
Debt repayments were the second single largest government spend after recurrent expenses such as salaries, allowances and administrative expenses which gobbled up nearly Sh306.53 billion.
The Treasury plans to spend nearly Sh696.55 billion on foreign and domestic debt obligations by end of this year in June 2020, which will be Sh129.65 billion, or 15.69 percent, less than Sh826.20 billion in the year ended last June.
Mr Yatani has pledged to reduce expensive borrowing in favour of concessional loans from foreign lenders at a time when the country is classified as a lower middle-income economy.
Ms Phyllis Makau, executive director of Parliamentary Budget Office, warned that there's little that will happen if the budget deficit is not brought down, and that non-discretionary expenditure is on the rise.
