Kenya’s Controller of Budget, Margaret Nyakango, has raised fresh concerns over the country’s rapidly increasing debt levels, warning that sustained borrowing is placing significant strain on the national budget.
Appearing before the National Assembly’s Debt and Privatisation Committee, Nyakango told lawmakers that heavy loan repayments continue to drain public finances, with funds being drawn directly from the exchequer to service debt obligations.
Heavy Loan Repayments Straining the Exchequer
Nyakango emphasized that Kenya’s fiscal space is shrinking as more resources are channeled toward repaying existing loans rather than funding development projects.
The continued cycle of borrowing has left the government grappling with mounting financial pressure.
She warned that the country risks deepening its debt vulnerability if urgent measures are not taken to manage borrowing and improve financial discipline.
In her submission to Parliament, Nyakango pointed to inefficiencies in how borrowed funds are utilized, highlighting a costly cycle of commitment fees and interest payments.
“I said in the report there seems to be a vicious cycle of this commitment fees and interest. We pay commitment fees because we have not accessed money for which we have signed. So the fact that the lender is packing it for us is what we are paying for,” she said.
Nyakango further attributed this challenge to weak implementation frameworks within government agencies.
“Indeed, that points to our implementation frameworks. A lot of times we are not ready or we are only partially ready to implement the programs for which we are borrowing,” she added.
Nyakango’s warning adds to growing calls for the government to reassess its borrowing strategy and tighten oversight on public spending.
Her presentation before Parliament signals increasing scrutiny on how public debt is managed, at a time when economic pressures continue to mount.
About the Author
