Treasury ‘not broke despite bid to borrow Sh7.2bn for voter kit’
PHOTO | FILE Independent Electoral Commission secretary James Oswago (left) with Treasury permanent secretary Joseph Kinyua after a media briefing on the delay in securing electronic voter registration kits for the coming General Election.
What you need to know:
- Despite its increasing appetite for borrowing, Treasury — through Permanent Secretary Joseph Kinyua — maintained that the country has sufficient funds to meet its obligations
- Central Bank of Kenya (CBK) reports indicate that the government’s overdraft facility at the bank shot up by Sh18 billion between July to September, rising over 300 per cent to Sh25.4 billion from Sh7.3 billion in the period
- The government’s domestic debt has risen by Sh129.3 billion since January this year in what analysts say could be unsustainable, given the rising demand for funds by public sector workers
Treasury has disputed claims that the government is broke, owing to its recent move to borrow over Sh7.2 billion to buy Biometric Voter Registration Kits from a commercial bank.
Despite its increasing appetite for borrowing, Treasury — through Permanent Secretary Joseph Kinyua — maintained that the country has sufficient funds to meet its obligations.
He added that the country enjoys support from international money lenders like the International Monetary Fund (IMF).
“We cannot be a broke country and yet we have an economy that is working well and, as a government, we continue to receive taxes to meet national obligations,” said Mr Kinyua.
Central Bank of Kenya (CBK) reports indicate that the government’s overdraft facility at the bank shot up by Sh18 billion between July to September, rising over 300 per cent to Sh25.4 billion from Sh7.3 billion in the period.
Unsustainable
The government’s domestic debt has risen by Sh129.3 billion since January this year in what analysts say could be unsustainable, given the rising demand for funds by public sector workers.
Domestic debt increased to Sh920.1, inching closer to the Sh1 trillion mark as of October 5, up from Sh790.8 billion in January.
Mr Kinyua, however, said Kenya is not in financial doldrums, instead urging that the arrangement to finance the BVR kits from a private bank was facilitated by the Canadian government through the Canadian Commercial Corporation.
“The StanChart loan to secure the BVR kits was facilitated by the Canadian government agency, which reflects the fact that they have confidence in the ability of the country to repay the loan and meet its obligations,” said Mr Kinyua on Friday in Nairobi.
He was speaking during a KCB management transition ceremony that saw former chief of general staff Joseph Kibwana appointed to the bank’s board as a director.
Mr Kibwana joins the bank together with former Treasury operative Charity Muthoni Muya (a director) and Mr Joshua Oigara (chief finance officer).
They take the place of three directors who retired in May. The three include outgoing chairman Peter Muthoka — who has now joined the board of the Kenya Institute of Management as chairman, and Ms Susan Omanga. Both served the bank for the past eight years.
