A Debt Sustainability Analysis report by the World Bank and the International Monetary Fund shows that Kenya’s reliance on commercial financing has increased and its risk of debt distress stands at high up from moderate due to the impact of the Covid-19 pandemic.
“Exchange rate fluctuations can also be attributed to the increasing debt,” the Credit Suisse report notes.
Every adult Kenyan carries a public debt load of about Sh57,608($523), according to the latest Global Wealth Report by Swiss investment bank, Credit Suisse.
National Treasury data shows that Kenya’s combined foreign and domestic debt currently stands at more than Sh7 trillion.
Kenya’s dollar exchange rate for instance fluctuated by 3.1 per cent in 2020, the report shows, pushing up the amount of dollar denominated loans.
Despite the high debt burden, the report places Kenya as the richest country in East Africa with total wealth estimated at Sh37.2trillion as of last year, accounting for 0.08 per cent of total world wealth.