How a new president will impact Kenya’s debt sustainability

Former Kenyan Vice President Kalonzo Musyoka delivers a speech during a campaign rally of the Azimio La Umoja (One Kenya Coalition Party) at the Jomo Kenyatta International Stadium in Kisumu August 4 ahead of the country’s general elections.

(PATRICK MEINHARDT/AFP via Getty Images)

None of Kenya’s presidential candidates have offered a workable plan to tackle the country’s growing debt burden, raising the likelihood that the country’s next president will be forced to abandon spending commitments. and to pursue fiscal consolidation and/or debt restructuring, or to deal with an economic crisis . Ahead of the August 9 general elections in Kenya, the two main candidates, Raila Odinga and William Ruto, have proposed opposing measures to deal with Kenya’s growing debt burden. Odinga, a political ally of current President Uhuru Kenyatta and a former prime minister, favors restructuring debt with the International Monetary Fund (IMF) while simultaneously increasing spending. Meanwhile, current Vice President Ruto says Kenya can pay its debts without external support, arguing for reduced borrowing and increased tax revenue to meet rising debt service costs while increasing social spending. Neither Ruto’s nor Odinga’s economic commitments are achievable in full, but Kenya’s looming service costs…

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