Politics and Society
Kenya’s outlandish public debt albatross
Kenya is struggling with its public debt, a heavy burden to the long-suffering citizens. Debt servicing currently sits at 65% of the total national budget. For every 100 shilling that the government has been collecting, 65 shillings has been going to debt repayment. As the debt spirals out of control, the corresponding poverty level is rising sharply.
Two weekends ago, presidential aspirant Jimi Wanjigi dropped a bombshell: Through a power point presentation, for close to an hour, in front of local and international press, Jimi painted a grim but sadly, a true picture of Kenya’s outlandish and overwhelming public debt.
The bombshell was not in acknowledging what’s already public knowledge; the soaring, spiralling and uncontrollable debt appetite by the government, but in the optics and mechanics of how that debt has been accumulated, who possibly has been accumulating it, who has been enabling the insatiable borrowing, why the debt has been accumulated and what for and how the public so far, has been duped into thinking that the borrowing of hundred of billions of shillings in their name, is for the public good.
The bewildering debt of trillion of shillings that now envelope Kenya’s national debt has so far been downplayed by the government and not many Kenyans may appreciate just how much the country could in the red. The true nature of the debt is clouded and shrouded in a labyrinthine maze of unscrupulous borrowing deliberately made so, so that ordinary mortals may not make head or tail of the trail of the staggering debt.
By the time, President Mwai Kibaki was leaving government, Kenya had a public debt portfolio of KSh2.37 trillion. Between 2003–2007, the height of Kibaki’s reign, the economy boomed at an all-time best of seven per cent. Since then, we have not been able to achieve that percentage growth. By the time, he was leaving State House, in 2012, in which time he was president of a government of national unity, from 2008, with Raila Odinga as Prime Minister, that debt was manageable and traceable. The corresponding poverty level to the debt was at 38%.
Kibaki’s outstanding debt was brought forward to June 30, 2014 and the Central Bank of Kenya (CBK), publicly acknowledged this debt in its report. Eight years later, in April 2022, the debt had quadrupled to KSh8.4 trillion. The CBK reported that the government had accumulated a total debt portfolio of KSh6.1 trillion. This meant that by the financial year 2021–2022, the debt servicing was at 65% of the total national budget. That is to say, for every 100 shilling that the government has been collecting, 65 shillings has been going to debt repayment.
For every 100 shilling that the government has been collecting, 65 shillings has been going to debt repayment
As the debt has spiralled out of control, the corresponding poverty level also climbed up: From 38% when Kibaki left office, to now 63% during the Jubilee government reign. Well, conventional logic would dictate that since the trillions of shillings was being borrowed for “development” and for public good, it would mitigate the exponential rise of poverty level. On the contrary. It then boggles the mind of every right-thinking Kenyan, what possibly the borrowed trillions of shillings have been for.
Hence, as the borrowing bonanza went up, so did the poverty level, which means that for every 100 Kenyans, 63, on the very least, cannot afford to clothe, educate and feed their children. In short, they live below the statutory social and economic rights that are demanded of a human being. Woe unto the poverty-stricken Kenyans if, for example, their kith and kin fall sick. Short of a miracle, or a massive harambee by friends and relatives, or a philanthropy coming along to their aid, their relative would just die.
State capture – the illicit control of the state organs for personal gain by business barons and powerful politicians – has never been so real in Kenya
State capture – the illicit control of the state organs for personal gain by business barons, corporations, the military brass, powerful politicians, influential public servants – has never been so real in Kenya. Simply put, state capture is just another name for kleptocracy. Theft. In Africa, state capture has been more prevalent in South Africa. So, intertwined have been the Gupta brothers with Jacob Zuma, former President, that they came to be known as “Zuptas.”
Circumventing, changing and subverting the new 2010 constitution of Kenya and the statutory laws governing the anti-corruption fight, have been “Zupta” like individuals, who Jimi said they number no more than 11. These individuals have grouped themselves “into a well-organized criminal syndicate to steal public tax revenue through purported public debt.”
Impossible amounts of money that have been “borrowed” by these individuals especially between 2013 – present, have plunged the country into a miasma of unmitigated deprivation, economic ruin and above all, a public debt that very soon, if it continues unchecked, will just be unbearable and unrepayable.
The upshot of Jimi’s central argument, in his fraud forensic investigation in my view, is fourfold:
Although the constitution is very succinct on how and why money ought to be borrowed in Kenyans name – for development purposes only – the government cannot borrow money to pay civil servants’ salaries for example; there isn’t empirical evidence to co-relate the humungous amount money borrowed to actual, placeable development.
The manner in which the trillions has been borrowed is shrouded in mystery and secrecy with the public not knowing what exactly the borrowed money has been used for, leave alone being consulted. So, the borrowing doesn’t have their imprimatur to allow the runaway borrowing. To the best knowledge of Kenyans, the trillions could, as well, have been channelled to “develop” phantom projects, or projects unrelated to public good.
In light of the astonishing and sickening revelations concerning the trillions of shillings borrowed in the name of Kenyans, a national conversation and debate should now ensue. How did we find ourselves in this rut? How come the government bodies charged with oversight responsibilities over public borrowing allowed such a “heist” to occur? As Kenyans, what can we do about this craze orchestrated by some state officers?
We are no longer dealing with the conventional corruption as we understand it, but outright pilfering of public money with great abandon
The subtext of Jimi’s findings is that the era of “corruption reforms” is over. With some of the best anti-corruption laws anywhere in the world, the Kenyan State can no longer pretend to fight corruption through the best anti-corruption laws in Africa. We are no longer dealing with the conventional corruption as we understand it, but outright pilfering of public money with great abandon. The State, like he says, has been captured by malignant forces hellbent on scuttling the very laws set to fight institutional corruption so as to milk its scarce resources.
Solution? The overthrow of the existing political class and its appendages. Sixty years into post-independent Kenya, the country has largely been governed by the same political barons whose chief agenda, it seems, has been to personally profiteer from public resources. “This spiralling appetite for public money by some powerful individuals with unlimited access to state coffers, must be the starting point, at which Kenyans should stamp their foot and say a huge no to their avarice,” says Jimi.
“Kenyans must demand a generational overthrow of the existing political class that has turned into leeches. That’s the only way they can safeguard their resources. The public debt is so huge that whichever incoming government, will have to address it as a matter of first priority, short of that, there could be an insurrection in the making.”
Kenyans must reject this unexplained debt burden that has been hoisted “around their necks like an albatross”, say Jimi. “There is no doubt in my mind that dynastic politics have been at the centre of this state capture. And they are not about to relinquish power, unless they’re stopped by Kenyans. Hence, the people must absolutely refuse their continued stranglehold on national politics, for them to be set free of their insatiable hunger for more and more public money.”
In view of Jimi’s bombshell, “a new brand of “generational” politics must be set in motion in order to salvage our economic fortunes, says Jimi Wanjigi.
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