Treasury Cabinet Secretary Henry Rotich has defended the cost of the Sh77 billion commercial loan recently taken to offset a mature debt of an equal amount.
Mr Rotich said the decision to take the eight-year loan with the current steep interest of 6.7 percentage points above the prevailing six-month London Interbank Offer Rate (Libor) was benchmarked on the cost of what was trading back in October.
The 6.7 per cent interest rate is the minimum margin above the Libor and it bears the risk of currency fluctuations.
“That happened in October and if you compare now the rates are different. Prices fluctuate every day,” said Mr Rotich.