Businesses & Financial News

Angry Kenyans miffed at State’s borrowing trend

A growing number of irate Kenyans yesterday began signing an online petition to the International Monetary Fund (IMF) seeking to cancel the Sh 255 billion loan facility to Kenya.

Through Change.org, a global lobby website, over 200,000 apprehensive Kenyans rallied behind the delicate petition to IMF executive board barely hours after it was set up.

“This is in recognition of the fact that previous loans to the Kenya government have not been prudently utilized and have often resulted in mega corruption scandals,” reads in part the petition initiated by Jefferson Murrey.

Further, the platform highlights previously borrowed loans, whose utilization have been questioned and mounting tax burden to Kenyan taxpayers as the main reasons for the petition.

“The scandals have not deterred the ruling regime from more appetite for more loans, especially from China. Right now Kenyans are choking under the heavy burden of taxation, with the cost of basic commodities such as fuel and nothing to show for the previous loans,” the petition read.

The revelation angered many at a time the biggest number of Kenyans are currently living in extreme poverty that has been heightened by the ongoing coronavirus pandemic.

The government has enforced lockdown measures in five majorly affected Counties as well as curfew restrictions to contain the virus spread – a decision that was vehemently opposed by middle income Kenyan earners.

The move (to borrow from IMF) represents the latest incidents of disquiet and displeasure among struggling Kenyans who took to social media over the weekend and most part of Monday to express their disapproval of the mounting loans saying the amounts will be misappropriated.

“Why are you approving loans to this irresponsible government,” queried one Twitter user, Salim Gooner.

Adding that, “You are sinking our economy deeper. We have those countries with poor economies that need that support and not this foolish government,” posed an irate Gooner, in a tweet seemingly directed to the global lender, IMF.

Another Facebook user wondered why IMF had loaned the amount to Kenya at a time majority of its citizens are living from hand to mouth.

“Stop dishing loans to Kenyan government. We the citizens are already overburdened. The said loan will end up in the pockets of a few gluttonous politicians,” posted Zachary Kittony on his Facebook wall.

The right to petition grants people not only the freedom to stand up and speak out against injustices they feel are occurring, but also grants the power to help change those injustices.

By law every person has a right to petition Parliament to consider any matter within its authority, including to enact, amend or repeal any legislation. Equally, the national assembly are allowed by law to make provision for the procedure for the exercise of this right.

On April 2, the IMF board approved a Sh 255 billion financing package for Kenya amid the COVID-19 pandemic. The international lender said the three-year financing package would help the country to support COVID-19 response and address an urgent need to reduce urgent debt vulnerabilities.

“The authorities’ program charts a clear path to reduce debt-related risks,” said Antoinette Sayeh, IMF Deputy Managing Director while making the announcement last Friday.

Kenya’s Public Debt has been on the rise, increasing from Sh 1.3 trillion 10 years ago to Sh 7.1 trillion now, at a 10-year CAGR of 18.5 per cent, according to estimates by investment firm, Cytonn.

The rising debt has been brought about by the government’s significant borrowing to fund infrastructural projects and bridge the fiscal deficit that has averaged 7.7 per cent of GDP since 2012, with borrowing being both direct and also by guaranteeing state corporations.

As of November 2020, Kenya’s total public debt is documented to have stood at Sh7.2 trillion and estimates show that debt will be at Sh8.7 trillion by December this year and will have crossed the Sh9 trillion mark by June next year. Presently the country borrows at a frightening Sh120 billion per month from various financial outlets including the World Bank, European Union, Africa Development bank, and USAID among others.

As at December 2020, debt mix stood at 51:49 ratio external to domestic debt, respectively, compared to 45:55 external to domestic debt 10 years ago. With the current pandemic, the revenue collections have also been hit and more borrowing is expected to bridge the gap.

 

 1,406 total views,  5 views today

Comments
Loading...
Social Media Auto Publish Powered By : XYZScripts.com