Kenya Settles Ksh72 Billion SGR Loan After Demand Note From China
On Friday, January 19, Senator Ledama Ole Kina from Narok expressed concerns that Kenya might face challenges in meeting its international commitments following the receipt of a Ksh72 billion payment request from China.
This pertained to the loans provided to Kenya for the development of the Standard Gauge Railway (SGR) and other infrastructure initiatives carried out by the preceding government.
“We already settled this debt as we shall do for many others as and when they fall due,” Treasury Principal Secretary Chris Kiptoo stated on Saturday, January 20.
The Public Secretary additionally guaranteed the citizens of Kenya that, with President William Ruto at the helm, the nation would not face any challenges in meeting its obligations for foreign loans.
“Meanwhile, we need to up the conversation on balancing revenue enhancement measures, debt management, and expenditure rationalization,” he added.
PS Kiptoo did not reveal whether the government had taken action in response to the demand note mentioned by Senator Ledama.
“Ksh72 billion Chinese loan for the SGR and Northern and Southern Bypass must be paid tomorrow. The Chinese have sent a demand note,” Ledama’s statement that prompted Treasury reply read in part.
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China holds the position of being the primary financial supporter of Kenya, having funded several multibillion projects, notably the Standard Gauge Railway (SGR) which was built at a total expense of Ksh508 billion (USD3.2 billion).
Conversely, the Southern Bypass in Nairobi had a price tag of Ksh15 billion, whereas the Northern Bypass was slated to incur a cost of Ksh8.5 billion.
The majority of funding, accounting for 85 percent, for the Northern Bypass project was provided by the Chinese government.
Given that China is the primary source of funding for the majority of Kenya’s infrastructure initiatives, it is anticipated that Kenya will persist in seeking loans from China.
In December of 2023, the government made public its declaration that China would provide Kenya with Ksh158 billion (equivalent to USD1 billion) by the middle of 2024.
On October 18, President Ruto journeyed to China to engage in discussions about securing a loan, as numerous initiatives initiated by his predecessor, Uhuru Kenyatta, had encountered delays attributed to insufficient funds.
Kenya Settles Ksh72 Billion SGR Loan After Demand Note From China
