Deputy President Rigathi Gachagua continues to attribute the country’s economic challenges to the previous administration, which was led by the now-retired President Uhuru Kenyatta. While Gachagua maintains a somewhat conciliatory tone towards Mr. Kenyatta, he asserts that the government that preceded Kenya Kwanza left the nation in a state of disarray. He accuses the previous administration of overreliance on debt as the primary means of financing operations and development, resulting in the current economic hardships experienced by Kenyans.
These remarks by DP Gachagua primarily revolve around the substantial debts that Kenya owes to foreign financiers, including China, the Eurobond, and the International Monetary Fund (IMF). Gachagua revealed that when their administration assumed office on October 6, 2023, Kenya was on the verge of commencing repayments for its foreign debts. According to the National Treasury, Kenya’s foreign debt now exceeds Sh10 trillion. Gachagua further disclosed that the government allocates over Sh600 billion each month towards servicing these debts, emphasizing that these obligations are not solely the burden of the current generation but extend to future generations as well.
However, Gachagua also underscored Kenya’s positive global reputation and the imperative to uphold it by fulfilling its loan payment obligations. He emphasized that Kenya must honor its commitments to maintain its reputation as a responsible nation. As a newly elected government, declining to initiate repayments when they assumed power was not a viable option. The primary challenge confronting the country is the significant debt burden, which led the President William Ruto-led administration to make the decision to increase taxes and levies.
In the upcoming year, 2024, Kenya is scheduled to begin repaying the controversial Sh259 billion Eurobond loan. Gachagua stressed the consequences of failing to meet these debt obligations, including the risk of global blacklisting and the reluctance of other nations to collaborate with Kenya. As a responsible government, they are committed to fulfilling their obligations and safeguarding the nation’s reputation on the international stage.