Fresh Treasury data shows the country has been borrowing Sh5.9 billion every week for the last four months, underscoring the deepening reliance on debt to fund government operations.
The figures, covering May 1, 2025 to August 30, 2025, indicate that the borrowing spree was driven by widening budget deficits and delayed revenue collection.
National Treasury’s documents tabled in the National Assembly on Tuesday shows that Kenya obtained a total of Sh95.5 billion during the four months.
Most of the funds were sourced from multilateral, bilateral and commercial lenders to support various projects across the country.
Broken down, the country was borrowing Sh23.9 billion every month, Sh795.8 million each day and Sh532.4 million every hour.
“One loan facility and one bond issuance from the previous period are reflected in the current report having been recorded in the commonwealth meridian system after a close of the reporting period,” the National Treasury document says of the new loans.
The revelations come amid growing concerns that the country has breached its statutory debt ceiling, raising fresh fears over the government’s borrowing spree and fiscal discipline.
Economists and lawmakers warned that the breach could expose the economy to heightened repayment risks and crowd out development spending.
According to Treasury, the national debt has surpassed the legal limit set by Parliament even as government insists it is still sustainable.
The law governing public finance states that the national government borrowing “shall not exceed the limit Parliament sets”.
Presently, the law has set the public debt ceiling at 55 per cent of the gross domestic product.
Treasury Cabinet Secretary John Mbadi on Tuesday said Kenya’s public debt has reached Sh11.81 trillion, representing 67.8 per cent of the country’s Gross Domestic Product (GDP) as of June 2025.
Addressing financial journalists, Mbadi said in present value terms, the debt stood at 63.7 per cent of GDP, a level that remains sustainable, though marked by heightened risk of distress.
Opposition leaders have however called for urgent measures to rein in borrowing and review the country’s fiscal framework, warning that continued debt accumulation could push the nation into a financial crisis.
Kiharu MP Ndindi Nyoro last month sounded an alarm over Kenya's rising debt warning of a dire economic consequences if borrowing continues unchecked.
The Treasury's briefing to Parliament is line with the requirement of the Public Finance Management (PFM) which requires Cabinet Secretary in charge of National Treasury to appraise the House on all loans procured by the government.
Section 31 (3) states: “At the end of every four months, the Cabinet Secretary shall submit a report to Parliament stating the loan balances brought forward, carried down, drawings and amortizations on new loans obtained from outside Kenya or denominated in foreign currency.”
The Act also compels the CS to specify the names of the parties of the loan and the amount plus currency of repayment.
Also to be included in the Treasury’s briefing is the conditions of the loan interests and other charges.
The documents tabled in the House shows that Sh62 billion, an international sovereign bond, was issued on April 30, 2025 by CitiGroup Global Markets Europe AG to finance liability management operations and budgetary support for the 2025-26 financial year.
The facility will be repaid in two equal instalments of $250 million on April 30, 2030, the first amortization date and April 30, 2032.
The loan will be repaid in two equal installments of $250 million on April 30, 2030, the first amortization date, and April 30, 2032, the maturity date.
“The loan attracts an interest rate of 8.25 per cent per annum of the outstanding principal amount of the notes,” the document reads.
Another Sh16.4 billion procured from the International Fund for Agriculture Development will be channelled to Integrated Natural Resources Management Programme.
It will go alongside in mitigating climate change and improve beneficiaries’ livelihoods, particularly for women, youth and other vulnerable groups.
The Treasury documents show that the loan will be repaid in 40 equal semi-annual repayments of $170,000 from June 15, 2030, through to December 15, 2049, attracting 1.41 per cent interest rate and a service charge of 1.39 per cent.
The state has also borrowed Sh5.35 billion from the Federal Republic of Germany towards the financing of the 8.6MW Gogo hydropower power plant redevelopment project.
The loan will be repaid in 20 equal instalments of EUR 1,666,666.66 from May 15, 2030 to November 15, 2039.
The last instalment of EUR 1,666,666.66 will be due on May 15, 2040.
The loan interest is at the rate of 2.98 per cent per annum- fixed interest rate on disbursed loan amount with a commitment fee at 0.25 per cent per annum on undisbursed loan amounts.
“The loan attracts a non-refundable on-time lump-sum management fee of 0.5 per cent of the loan amount,” the loan document says.
INSTANT ANALYSIS
Treasury has always defended the borrowing pace, saying it was necessary to sustain public services and stabilise cash flow. But critics warned the trend could push Kenya’s debt to unsustainable levels, with mounting interest payments eating into development funds.
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