Kenya’s Public Debt Increases Due to Fiscal Pressures

(3 Minutes Read)

The debt has expanded dramatically since it first crossed the KSh 1 trillion mark in April 2009. Back then, the country’s borrowing was relatively modest compared to current levels, but fiscal deficits and infrastructure investment ambitions fueled an accelerated pace of borrowing over the years.

Kenya’s public debt has continued its upward march, hitting KSh 11.36 trillion by March 2025, a record high that underscores the country’s deepening fiscal pressures and the urgent need for sustainable debt management strategies.

The debt has expanded dramatically since it first crossed the KSh 1 trillion mark in April 2009. Back then, the country’s borrowing was relatively modest compared to current levels, but fiscal deficits and infrastructure investment ambitions fueled an accelerated pace of borrowing over the years.

 Kenya’s domestic debt has grown faster than external debt, standing at KSh 6.20 trillion by 23 May 2025 having crossed the KSh 6 trillion milestone for the first time on 14 February 2025, marking a significant fiscal development — a testament to the country’s increasing reliance on short-term borrowing instruments.

The last seven years, in particular, have seen Kenya’s debt balloon at an alarming pace, driven by large infrastructure projects, pandemic-related expenditures, and rising debt service costs.

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https://trendsnafrica.com/kenyas-public-debt-all-time-high-stands-at-usd-13-3-bn/

Kenya’s external obligations have eased somewhat in local currency terms thanks to a favourable exchange rate. This has offered some relief to the country’s debt service burden. However, in USD terms, the foreign debt load continued to rise, reaching a record high of USD 40.51 billion by March 2025.