Treasury cuts net external borrowing by Sh61.6bn

The Treasury has cut the net amount it expects to borrow from external lenders in the current financial year by Sh61.6 billion to Sh225.8 billion, reflecting delays in accessing loans from multilateral lenders and falling interest rates that have made domestic borrowing cheaper.

The external target has been cut despite the budget deficit going up by Sh323.4 billion to Sh1.22 trillion in the Supplementary I 2025/2026 Budget that was passed last week. In response, the Treasury has raised the net domestic borrowing target by Sh385.1 billion to Sh998.6 billion in the mini budget.