Raila Odinga Demands Answers as Kenya Kwanza Government Borrows Ksh.213.4B Ahead of New Fiscal Year
Raila Odinga, the leader of the Azimio la Umoja One Kenya Coalition Party, is now demanding an explanation from the Kenya Kwanza government regarding the alleged borrowing of Ksh.213.4 billion just one week before the start of the new fiscal year.
Odinga, the leader of the opposition party Azimio, issued a statement on Tuesday in which he criticized the administration of President William Ruto for what he termed “suspicious” borrowing and demanded that the government come clean about the new debt.
Raila Odinga questioned Ted regarding the origin of the substantial internal debt, its timeliness with the passage of the controversial Finance Bill 2023, and its abnormally high-interest rate of approximately 16% compared to other local lenders.
Odinga stated, “With the Finance Bill providing a perfect cover, the Kenya Kwanza administration has engaged in a suspicious borrowing spree in recent days, which the Azimio Coalition Party demands clarification on.”
The Kenya Kwanza administration borrowed Ksh.213.4 billion from local financial institutions in a single day last week. This debt has several peculiar and disturbing characteristics. First, it occurred just ten days before the beginning of Kenya Kwanza’s first Financial Year on July 1, 2023. The interest rate on this loan was 15.84%.”
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The leader of the opposition questioned the purpose and expenditure of the lump sum, arguing that the money cannot be spent within 10 days nor is it permitted by law.
“This single borrowing accounts for nearly half of the approved annual domestic borrowing total of Ksh438 billion for 2022-23. Even though the regime has been borrowing throughout the year, it borrowed Ksh213.4 billion last week.
“Where is all of this money going a week before the start of the new fiscal year? Kenyans deserve a full account. Why such massive borrowing a week before the close of the old fiscal year and the start of the new one? Can the regime consume 213.4 billion Kenyan Shillings in one week?”
According to the leader of the Azimio party, this type of government borrowing has a greater impact on market liquidity than borrowing from the private sector.
According to him, the loan’s high-interest rate will directly increase rates for the private sector and individuals.
What effect does this singular borrowing have on market liquidity? He struck a pose. “Why does the regime exclude the private sector from the credit market on purpose? The government has borrowed at a rate of 16%, while the private sector, including small businesses, will pay interest rates of 24% or higher on their loans.
“Does the administration comprehend or care about the effects of this reckless borrowing at extremely high-interest rates on Kenyan businesses and citizens?”
Raila Odinga Demands Answers as Kenya Kwanza Government Borrows Ksh.213.4B Ahead of New Fiscal Year
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