China has acknowledged that Kenya has performed exceptionally well in servicing its debt, Treasury Cabinet Secretary John Mbadi has claimed.
Speaking on Friday, Mbadi stated that China had ranked Kenya among the best-performing African nations in terms of debt repayment. Owing to this performance, he added, China has expressed a willingness to support Kenya’s liability management efforts.
“What we are discussing largely is how we have performed in terms of paying our debt, which China agrees Kenya has done exceptionally well—better than any other country in the region. Kenya is the only country that has managed to service its debts to China without any default or signs of possible default,” Mbadi said.
Kenya’s debt to China stands at approximately Ksh866 billion (USD 6.7 billion). The country ranks among the top five nations globally with significant debt to China, alongside Ethiopia, Sri Lanka, Angola, and Pakistan.
Kenya has continued to service its loans diligently, with repayments to China reaching Ksh107 billion in the latest financial year.
In a joint communique between President William Ruto and China’s President Xi Jinping, China praised Kenya’s efforts to manage its debt responsibly through economic reforms that have helped free up funds for long-term development.
“China commended and expressed support for Kenya's ongoing efforts on liability management through sustained economic reforms to create the fiscal space necessary for sustainable development,” read part of the statement shared by the Kenyan government.
As a result of this fiscal discipline, China is now considering granting Kenya more autonomy to control and restructure its debts—allowing the country to meet its obligations while continuing to invest in key areas such as infrastructure, healthcare, and education.
According to Treasury CS John Mbadi, Kenya is working to expand its fiscal space to facilitate new projects with China, particularly those aimed at driving economic growth.
One major shift under consideration is transitioning from U.S. dollar-denominated loans to those in China’s local currency, the Renminbi (RMB)—a move expected to ease currency pressure and improve loan terms. The Standard Gauge Railway Phase I was previously funded in U.S. dollars.
“As we embark on new projects, we are exploring the possibility of financing them in Renminbi. We are asking: What are the terms? Are they better? I’m told they are. China, through institutions like the China Development Bank, is open to this approach,” Mbadi noted.
China is expected to support in the expansion of the Standard Gauge Railway (SGR) from Naivasha to Malaba, the Nairobi–Nakuru–Malaba Highway, Textile and Solar Power Factories, which China has already pledged Ksh2.6 billion, Kikambala Special Economic Zone (EPZ), and Steel Research Center, among other projects.
The developments come as President Ruto made a five-day state visit to China from April 22.
