Kenya's Public Debt Soars to Record High

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Kenya's Public Debt Soars to Record High

Kenya's public debt has reached an unprecedented high of Sh11.14 trillion, a significant increase of Sh1.93 trillion in the year ended December 2023. This translates to a daily debt accumulation of Sh5.29 billion.

The depreciation of the Kenyan shilling against the US dollar has significantly impacted the external public debt, contributing to 73% (Sh1.4 trillion) of the increase in public debt. The shilling's decline has made external debt more expensive to service, as more shillings are required to purchase the same amount of foreign currency.

From January to December 2023, external public debt surged by Sh1.416 trillion, reaching Sh6 trillion. Meanwhile, domestic debt also increased, albeit at a slower pace, rising by Sh514.48 billion to reach Sh5 trillion.

Multilateral loans, primarily from organizations like the World Bank and IMF, accounted for the largest increase in external debt, soaring by $1.62 billion. Bilateral loans, on the other hand, experienced a decline of $692.72 million, amounting to $9.089 billion by December 2023.

Domestic debt also experienced significant growth. Non-bank debt increased by Sh303 billion, while commercial bank debt rose by Sh92.3 billion. Debt from the Central Bank of Kenya increased by Sh77.2 billion, totaling Sh224.47 billion.

Despite a decrease in the stock of Treasury Bills, the total stock of Treasury Bonds witnessed an increase from Sh2.53 trillion to Sh2.73 trillion during the same period.