National Treasury admits to debt crisis
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National Treasury admits to debt crisis warning of lower revenues which could impact government activities
National Treasury admits to debt crisis warning of lower revenues which could impact government activities.
Treasury Cabinet Secretary Njuguna Ndung’u said this is compounded by lower-than-expected income, which may affect the government’s capacity to fulfill its ambitious bottom-up pledges.
“The economy faces two extreme constraints: financing constraints as tax revenues generated cannot finance the development we wish to have, and on the other extreme we have limited headroom for debt,” he said Wednesday at a forum organised by the Diamond Trust Bank (DTB).
We have a mountain of inherited debt that needs to be paid.
The latest estimates place public debt at Sh9.6 trillion, as both internal and foreign liabilities have rise rapidly.
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This comes as Ruto’s revenue plan is also yet to gain momentum as tax collection in the just-ended financial year fell short of the government’s target.
This dealt a major blow to the President’s efforts to fund his costly campaign promises and repay mounting public debt at a time his administration’s additional taxes are stoking tensions amid a high cost of living.
Parliament recently acceded to the Treasury’s request to raise the debt ceiling to a percentage of gross domestic product rather than a specific number.
Kenya’s public debt grew by nearly Sh700 billion in the six months to March this year under Ruto’s government, pointing to a sustained borrowing appetite.
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