Kiharu Member of Parliament Ndindi Nyoro has issued a stark warning regarding Kenya’s escalating debt, projecting that the country is perilously close to joining the ranks of Africa’s debt defaulters.
At the Institute of Public Finance’s annual budget review, Nyoro expressed grave concerns over the public debt, now estimated at a staggering Sh11 trillion, stating that the situation is spiraling out of control.
“The country is edging dangerously close to default,” Nyoro asserted, emphasizing that ongoing debt restructuring discussions—including a forthcoming visit to China by President William Ruto—underscore the fragility of Kenya’s financial landscape. “Any indication that we are unable to service our loans is more catastrophic to our economy”.
Once a staunch ally of President Ruto, Nyoro’s relationship with the administration has grown increasingly strained.
His divergence became apparent late last year when he declined to support the impeachment of Deputy President Rigathi Gachagua, who has since emerged as a vocal critic of Ruto.
This fallout led to Nyoro’s removal from his position as chairman of the influential Budget and Appropriations Committee.
Nyoro highlighted a troubling trend in Kenya’s debt accumulation, which has surged from under Sh2 trillion to Sh11 trillion over the past 12 years.
Under Ruto’s leadership alone, the national debt has increased by over Sh2 trillion, rising from Sh8.7 trillion to Sh10.9 trillion as of December 2024, according to data from the Central Bank.
Notably, local lenders account for 54% of this debt, while the remaining 46% is owed to external creditors.As the Treasury gears up to finalize the 2025/2026 budget, projected spending is set at Ksh.4.2 trillion.
Nyoro cautioned that debt servicing will consume nearly a quarter of this budget, with interest payments expected to reach about Ksh.1 trillion. Of this, Ksh.750 billion is earmarked for domestic debt and Ksh.200 billion for external repayments.
Critiquing the government’s aggressive taxation policies, Nyoro argued that such measures have backfired on the economy. “Increasing taxes to get more revenue is a fallacy,” he stated.
“You end up distorting economic decisions. People stop spending and investing—and that means even the little revenue you hoped to raise never materializes.”
