Kenya’s public debt has reached an unprecedented degree of 10.1 trillion shillings (64.1 billion euros), in line with authorities figures launched on Tuesday, exceeding the ceiling set by regulation and threatening the nation’s already fragile financial state of affairs.
This debt represents 62.43% of GDP, and exceeds the debt ceiling of 10 trillion shillings.
In June, the Nationwide Meeting voted on an modification, nonetheless to be submitted to the Senate, that units the cap not at a set quantity however at a share of GDP.
This report debt exacerbates the gloomy financial outlook for Kenya, the financial engine of East Africa with a inhabitants of 53 million, after its progress slowed to 4.8% in 2022 (in comparison with 7.6% within the earlier yr) within the face of persistent inflation that fell to 7.3% on an annual foundation in July. /July.
The price of repaying the debt is growing with the continued depreciation of the shilling, which reached 143.44 shillings relative to the greenback in August.
On July 20, Fitch Scores downgraded Kenya’s means to repay its debt to worldwide lenders from “secure” to “destructive” and cited dangers posed by “introduced tax hikes within the context of social unrest”.