Monday, September 18, 2023 – President William Ruto has just lied to Kenyans yet again. This is after he increased borrowing despite promising never to go for foreign debts.
The Kenya Kwanza administration increased foreign borrowing after revising the 2023/24 financial year budget from Ksh3.7 trillion to Ksh3.9 trillion.
In the Budget Review and Outlook Paper (BROP) released by the Treasury on Sunday, the government has increased the amount to be borrowed from the foreign market from Ksh131 billion to Ksh449 billion, while cutting domestic borrowing to Ksh411 billion.
Treasury hopes to finance the increased budget using increased tax revenues and foreign borrowing which has been revised upwards.
Ruto rode to power on the promise of cutting reckless spending and borrowing but has since ramped up foreign and domestic loans since taking office.
Borrowing from the domestic market as promised by Central Bank Governor Kamau Thugge has dropped, though not at the initially projected Ksh316 billion.
The government will borrow Ksh411 billion domestically from Ksh583 billion that had been approved by parliament in June.
The government hopes to slow down interest rates and encourage lending to the private sector by cutting the uptake of debt from local banks.
Revised spending has been necessitated by adjustments in the national government spending.
In the budget, ministerial national government expenses had been allocated Ksh2.38 trillion but the amount has now been revised to Ksh2.4 trillion.
Additionally, the Treasury will spend Ksh1.3 trillion in interest and pensions up from the planned Ksh986 billion.
While the Treasury has increased the budget for National Government expenses, the equitable share sent to counties remains unchanged at Ksh385 billion.
The Kenyan DAILY POST.