MPs Raise Alarm Over 8 Parastatals Kenya Used to Take Loans

  • President Uhuru Kenyatta addressing the nation flanked by Agriculture CS Mwangi Kiunjuri and Treasury CS Henry Rotich Twitter
  • Members of Parliament have expressed concern over Kenya's ballooning debt and the state corporations that were used to guarantee loans of up to Ksh147 billion. 

    A Parliamentary Budget Office document presented on Thursday revealed that the country could lose parastatals and key assets if it defaults on the payments. 

    Kenya Power was used to guarantee Ksh14 billion, Kengen Ksh10 billion, Kenya Airways Ksh76 billion, KBC Ksh6 billion and Kenya Railways Ksh4 billion. 

    Kenyan MPs in a session

    Tana and Athi River Development Authorities were used to guarantee Ksh542 million and East African Portland Cement Company Ksh674 million. 

    This comes as President Uhuru Kenyatta and former Prime Minister Raila Odinga are in China to secure a Ksh368 billion loan for the extension of the SGR from Naivasha to Kisumu. 

    Emgwen MP Alex Kosgey proposed an amendment of the law to regulate government borrowing, terming the current debt standing at Ksh5.6 trillion as excessive.

    Currently, the constitution doesn't give MPs any power to control the government's borrowing. 

    Parliament is only tasked with putting a ceiling on how much the government should borrow compared to its GDP, which is set at a 50 per cent limit of the national public debt. 

    “We cannot allow this situation whereby the Treasury or the Presidency or anyone can just decide today that they want to borrow this much yet we have already overburdened the common mwananchi,” commented Sigowet-Soin MP Kipsengeret Koros.

    Mathira MP Rigathi Gachagua stated, “Let us be careful that we don’t sign an agreement that will make us slaves to foreigners; that will enslave us for 30-40 years.”

    Treasury CS Henry Rotich showing of the briefcase containing the National Budget Policy Statement