Kenya received its first commitment from China in four years, breaking a lull that came after Beijing slowed down lending to developing countries on increased risks of debt distress.
Data from the Global Development Policy Centre shows Chinese loan commitments to Kenya resumed in 2024, ending a hiatus that lasted from 2020 to 2023. Between 2020 and 2023, Chinese loan commitments to Kenya stopped entirely.
Chinese financing resumed in 2024, with $277.8 million (Sh37.43 billion) in new commitments. The loans were issued by the China Development Bank (CDB) to support road rehabilitation projects.
New lending by China to developing countries such as Kenya has slowed down in the aftermath of default concerns, which were exacerbated by the outbreak of the Covid-19 pandemic in 2020.
According to reporting by the Financial Times, Beijing based lenders including China Eximbank (the financier of Kenya’s SGR project) and China Development Bank, the country’s two main policy banks, have adopted increasingly hardline lending terms.
At the November 2021 triennial Forum for China-Africa Cooperation, China's President Xi Jinping said the country would cut the headline amount it disburses to Africa by a third, to Sh5.1 trillion ($40 billion) while redirecting new funding from large infrastructure to SMEs and green projects.
The pivot left China’s 2013 belt and road initiative, a massive global infrastructure and investment strategy, in limbo, and the consequence has been little to no new lending to countries like Kenya.
Under then President Mwai Kibaki, Chinese lending increased gradually as diplomatic and economic ties strengthened with total commitments of nearly $1.6 billion.
Chinese borrowing surged during President Uhuru Kenyatta’s tenure as Kenya launched major infrastructure projects.
Notably, total commitments under president Uhuru crossed $8 billion with major investments such as the SGR, highways and energy and power transmission infrastructure.
