Treasury CS John Mbadi. Photo | courtesy.
Treasury Cabinet Secretary, John Mbadi, has openly acknowledged the country’s economic struggles but assures that the government is implementing strategies to improve the situation.
Mbadi attributed the current financial strain to loans previously acquired for long-term development projects, whose benefits are expected to materialize in the coming decades.
“The loans, some of three, five, seven, and ten years, were short-term, which we have to pay with interest, but the results of the projects will start being seen after 30 years. That is the struggle,” Madi said.
Mbadi however told Kenyans not to despair arguing that the government is working hard to improve the economy.
“Even when I tell you about the difficulties and stress of paying debts, it is not to scare you,” Mbadi assured.
This candid admission contrasts with President William Ruto’s more optimistic portrayal of the economy. While the President emphasizes economic growth, Mbadi cited the immediate challenges posed by debt repayment obligations.
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The government’s borrowing has led to increased debt service costs, with a significant portion of revenue allocated to interest payments. This situation has raised concerns among citizens and experts about the sustainability of national debt levels.
In response to these challenges, the government is seeking new funding arrangements with international partners, including the International Monetary Fund (IMF). Recent reports indicate that Kenya has reached an agreement with the IMF to abandon its current lending program in favor of a new one, aiming to address mounting debt-servicing costs.
