Why China is worried about Kenya’s huge loan portfolio

President Uhuru Kenyatta with China's Foreign Affairs Minister Wang Yi

Despite strong advice by economic experts and multi-lateral lenders who have advised the government to scale down spending on infrastructure, president Uhuru Kenyatta’s regime has gone ahead and embarked on putting up major works like the Nairobi Expressway from JKIA airport to Westlands

By The Weekly Vision Online

China’s Foreign Affairs Minister Wang Yi is currently visiting Nairobi and has since held talks with President Uhuru Kenyatta, both men defended the multi-billion-shilling SGR project from critics. The project was financed through loans from Beijing.

But even as President Kenyatta and his visitor from Beijing were defending the SGR and other Chinese funded megaprojects currently ongoing like superhighways, the timing of the diplomats’ visit, just seven months before Kenya’s elections has not been lost on keen observers. There are growing fears among multi-lateral lenders over Kenya’s ability to repay the huge external debt now in the region of Ksh. 13 trillion and is expected to soar when the country holds one of Africa’s most expensive general elections in August this year.

Kenya’s election body IEBC announce a budget of Ksh. 43 billion to hold the elections. IEBC is however faced with a budget deficit of Kshs 15 billion, at the same time the National Treasury announced the freezing of fundings to public universities saying the country is broke!

Kenya tops Africa as the most indebted nation to China and there are claims Beijing is keen to hold on to some security like the Lamu port that it is also refurbishing as they did in The Gambia where China took control of the port in a bid to recover its debt

Despite strong advice by economic experts and multi-lateral lenders who have advised the government to scale down spending on infrastructure, president Uhuru Kenyatta’s regime has gone ahead and embarked on putting up major works like the Nairobi Expressway from JKIA airport to Westlands. The president has also pumped billions of shillings into a new shipping dockyard in Kipevu, Mombasa and also revamped the Kisumu port on Lake Victoria, a project whose economic viability has been roundly questioned.

Kenya tops Africa as the most indebted nation to China and there are claims Beijing is keen to hold on to some security like the Lamu port that it is also refurbishing as they did in The Gambia where China took control of the port in a bid to recover its debt. With barely seven months in power, President Kenyatta has been keen to score even some marginal gains on his highly touted Big 4 agenda. The projects are said to be in tatters mainly as a result of the global Covid-19 pandemic. China which has invested heavily in Kenya’s infrastructure like the Thika superhighway and several upscale bypasses from the CBD to the suburbs will be watching the unfolding Uhuru Kenyatta succession closely.

Beijing is alive to some local critics who have been against external borrowing warning that regime change in Nairobi could see the next government renege on paying debts. It’s against this backdrop that the visit by China’s top diplomat is being seen as more than meets the eye! Kenyatta said Kenya would not have today’s development achievements without China’s strong support, which is imprinted on the mind of the Kenyan government and its people.

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