Concerned over the status of the public debt, the Senate Committee on Finance has directed the Treasury Cabinet Secretary Ukur Yattani furnish it within seven days a schedule of the external debts earmarked for retirement.
The Committee chaired by Kirinyaga Senator Charles Kibiru is concerned with the management of the public debt and is seeking to ensure that commercial debt that can be paid earlier to avoid exorbitant costs is dealt with first.
Kibiru said this will ensure value for money, prudent fiscal management as they seek ensure that the country does not get into a debt trap.
In his submission, Yattani said that debt retirement is a lengthy and tedious process but the ministry had engaged experts to advise on how to go about restructuring the loans.
He said as at the end June 2021, Kenya’s nominal public debt stock stood at Ksh 7.74 trillion (USD 71.52 billion) equivalent to 69.07 per cent of GDP. This comprises of 52.1 per cent or Ksh 4.04 trillion External debt and 47.9 per cent or Ksh 3.70 trillion Domestic debt.
The meeting between the Senate Committee and the Treasury on the status of public debt in Kenya was held in Mombasa where Yattani was put on the spot by the Senators.
“When you appeared before us over a year ago part of your immediate concern and engagement was to retire expensive debt and leave the less expensive debts. What changed?” posed Sen Moses Wetangula.
In his presentation to the Committee, Yatani compared Kenya’s debt ratio to GDP to that of Japan, the US, UK and Angola saying that the country’s GDP ‘didn’t indicate that there is a serious problem’ – an issue that did not sit well with the Senators.
The Committee took exception to his remarks noting that it had earlier cautioned him against comparing Kenya’s GDP to those of advanced countries with huge economic bases and international investments.
The Committee also discussed other issues that included the Public Private Partnership bill that will be beneficial to counties and the County Government Cash Disbursement Schedule for 21/22.
This is a key Senate resolution as it operationalize the release and transfer of approved allocation as per the Annual County Allocation of Revenue act. Other Senators present at the meeting included- Sen Farhiya Ali, Sen Rose Nyamunga and Sen Mutula