Kenya borrowed KSh430.6 billion (over UShs15 trillion) in the five months to June, highlighting the Jubilee administration’s appetite for foreign money to finance mega infrastructure projects.
The Daily Nation reports that the Treasury signed a total of 29 new loans involving bilateral, multilateral and commercial creditors.
“The proceeds from all the facilities (Sh430.6 billion) are expected to finance development projects to achieve the country’s development agenda,” said Treasury Secretary, Henry Rotich in a report to Parliament on all new loans contracted by the government from February 1 to June 30, 2017.
“The funds are mainly to fund infrastructure projects including roads, irrigated water and water supply, energy, health and education.”
Kenya has ramped up spending in recent years to build a modern railway, new roads and electricity plants, driving up the budget deficit.
The World Bank recently warned that the country’s growing appetite for loans, especially Chinese debt, risks hurting the economy.
The country contracted Sh146.9 billion syndicated loan facilities from Citi Bank and PTA Bank for budgetary support in funding of infrastructure development.
Mr Rotich said majority of the creditors are bilateral while others are multilateral and commercial.
The report, tabled by the National Assembly Leader of Majority Aden Duale, shows that out of the Sh430.6 billion of the new loans, Sh156 billion from two commercial creditors have been disbursed.
The Sh156 billion was secured from PTA Bank and a consortium of lenders comprising Standard Chartered Bank, Citi Bank and Rand Merchant Bank.