NAIROBI, Kenya – Kiharu Member of Parliament Ndindi Nyoro has issued a stark warning over Kenya’s rising debt burden, drawing parallels to the financial turmoil currently unfolding in Senegal.
In a detailed statement, Nyoro cautioned that Kenya risks falling into a similar fiscal crisis if it continues adopting opaque borrowing practices. His remarks come amid revelations in Senegal that the previous administration, led by former President Macky Sall, had contracted approximately $13 billion in undisclosed “off-the-book” loans, now discovered by the new government of President Diomaye Faye and Prime Minister Ousmane Sonko.
“We must as a country avoid falling into that kind of abyss,” Nyoro said. “The national debt in Kenya now stands at over KSh 12.5 trillion, and we are borrowing between KSh 3.5 billion to KSh 4 billion every day in net terms.”
The legislator expressed concern that, beyond Kenya’s official debt book, the government has begun engaging in off-the-record borrowing mechanisms that bypass parliamentary scrutiny and transparency. He highlighted several recent examples of what he termed “hidden debt.”
Off-the-Book Borrowing Mechanisms
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Securitisation of Fuel Levy:
According to Nyoro, the government has borrowed KSh 175 billion, using the fuel levy expected to be collected over the next seven years as collateral. He added that another KSh 100 billion deal is currently being negotiated under the same arrangement. -
Talanta Hela Bond:
The MP revealed that through the Talanta Bond, the government raised KSh 44.5 billion, pledging future revenues from the Sports Fund for the next 15 years. “The interest alone on this facility will cost taxpayers KSh 100 billion by maturity,” he noted. -
Tourism Fund:
Nyoro said the Tourism Fund is following a similar pattern of pre-committing future revenues to access immediate loans. -
Housing Levy Collateralisation:
He warned of ongoing plans to borrow about KSh 400 billion, backed by the Housing Levy expected to be collected over several years — essentially, “collecting future levies in advance.” -
Creation of an Infrastructure Fund:
The Treasury, Nyoro claimed, is in the process of setting up an Infrastructure Fund, which he described as another vehicle for off-the-book borrowing.
Nyoro argued that such financing structures not only undermine transparency but also constrain Kenya’s future fiscal flexibility.
“This while illegal also constrains the future flexibility of the country’s finances,” he said. “All these funds are fully owned by the government. If they default, it is the taxpayer who will eventually shoulder the burden.”
He urged policymakers to reconsider these approaches before they plunge the country into a debt crisis similar to Senegal’s.
“It is important that Kenyans know this. Ramifications will definitely come. I hope sanity reigns and we avert a catastrophe by acting differently. We are African, and Africa is our business,” Nyoro concluded.
Senegal’s discovery of $13 billion in secret loans has sparked public outrage and financial instability, raising concerns over governance and accountability in Africa’s public finance systems. Economists say Kenya’s increasing reliance on securitisation and future revenue-backed loans could expose it to similar fiscal shocks if not managed prudently.
As Kenya continues to grapple with rising debt repayments and shrinking fiscal space, the warning from the Kiharu MP adds to growing calls for transparency and legislative oversight in public borrowing.
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