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Struggling State firms gobble up 39pc of Kenya’s external debt
Kenya Airways planes at the Jomo Kenyatta International Airport (JKIA). According to AfDB report, the transport sector is the second-largest consumer of external loans, accounting for 21.8 percent, or Sh1.19 trillion, of Kenya’s foreign borrowing.
Struggling government-owned companies now account for more than a third of Kenya’s external loans as they increasingly rely on debt to sustain operations, a trend that is swelling public debt and repayment costs, and pushing the country closer to debt distress.
An analysis by the African Development Bank (AfDB) shows that of the Sh5.48 trillion owed to external lenders as of June, 38.5 percent – about Sh2.11 trillion – was borrowed to support underperforming State-owned enterprises (SOEs).
