Details of how the Kenyan government borrowed a whopping Sh410 billion in three months have emerged.
The funds were mainly borrowed from various international lenders including the World Bank in three months starting March when the country recorded its first case of coronavirus, according to a report by Daily Nation.
This means the country was loaned an average of Sh4.5 billion per day and Sh136 billion monthly, the fastest borrowing spree ever by an East African nation.
Daily Nation reports that the borrowing spree is attributed to projected simulations by the Health Ministry experts who warned that the country could be overwhelmed by a high number of Covid-19 infections, hence the need to have a huge financial muscle to overcome the situation.
The funds borrowed by the National Treasury were allocated to the Health Ministry, which would in turn disburse them to the counties through the Covid-19 emergency funds.
Out if the Sh410 billion borrowed during the period, Sh303 billion was sourced from international lenders while Sh107 billion was borrowed locally.
This pushed Kenya’s total public debt to Sh6.6 trillion according to date by Central Bank of Kenya (CBK).
The National Treasury borrowed a further Sh200 billion locally between June and August, Daily Nation added. The country’s public debt could cross the Sh7 trillion mark once official external borrowing figures are updated to August.
The country’s public debt, which has raised sustainability questions recently, currently stands at nearly 70 percent of the GDP.
President Uhuru has previously downplayed concerns over the huge debt, saying Kenya must borrow if it is to realize tangible development.
"What would worry me is if the debt that we have incurred has gone into recurrent expenditure, has gone into paying salaries or electricity bills and so on and so forth. But what we have utilized our debt for is to close the infrastructure gap," Uhuru said in a past interview.