Kenyans to gain clear picture of national debt in August audit

Kenyans will soon learn the true extent of their country’s public debt, as the Office of the Auditor General (OAG) finalizes a long-awaited audit of the national debt portfolio.

Set to be completed by August, this audit, which spans all debt accumulated since Independence, will be the first independent review of its kind.

The final report will offer a comprehensive look at Kenya’s financial obligations, providing the public with a clear understanding of the growing debt burden.

The audit, requested by Parliament, has faced delays due to challenges in tracing older documents from past decades.

Deputy Auditor General Isaac Kamau explained the difficulty of examining debt records dating back to Kenya’s Independence, which has complicated the process.

"We are facing challenges in tracing some documents. Remember, we are auditing public debt from Independence, and that has brought some challenges," Kamau told the National Assembly’s Constitutional Implementation Oversight Committee last week.

This audit follows concerns from lawmakers, including Suba South MP Caroli Omondi, who pressed for transparency in the country’s debt and tax waiver records.

"We need to see a full list of what we owe as a country," Omondi said during the meeting, underlining the public’s desire for clarity on the nation’s financial standing.

As the audit progresses, the country’s debt situation has become increasingly urgent.

Kenya’s total public debt has now surpassed Sh11 trillion, raising alarms about the nation’s ability to manage such a large financial obligation.

Treasury Cabinet Secretary John Mbadi confirmed in March that the national debt stood at Sh11.02 trillion by January 2025, split between Sh5.93 trillion in domestic debt and Sh5.09 trillion in foreign debt.

The breakdown of external debt includes multilateral, bilateral, and commercial debts, with multilateral debts making up a significant portion.

"In terms of external debts, we have the multilateral debts, bilateral debts, and then the commercial debts. In terms of multilateral debts, we have $2.83 trillion (Sh366.48 trillion), which, if you look at it, is about 55 to 56 percent of the total external debts," Mbadi said.

Concerns about the sustainability of Kenya’s borrowing have been voiced by several economic experts.

Kiharu MP Ndindi Nyoro recently warned that Kenya is on the brink of joining Africa’s "debt defaulters club" unless urgent measures are taken.

Speaking at the Institute of Public Finance’s annual budget review, Nyoro cautioned, "Any indication that we are going to default or are unable to service our loans is more catastrophic to our economy."

Despite these warnings, Treasury CS Mbadi sought to reassure the public that Kenya is not facing an immediate default risk.

He explained that while the figures are concerning, the problem lies more with liquidity and loan maturities.

"Loans were taken at a particular point in time, and most of them are maturing between now and 2032. That is why we have the pressure," Mbadi said.

Meanwhile, the public is not the only one seeking answers about the nation’s debt.

Legal action has also been taken, with Busia Senator Okiya Omtatah and other petitioners demanding accountability from former President Uhuru Kenyatta and other senior officials over the country’s debt management.

As the OAG prepares to complete its audit, all eyes will be on the August report, which is expected to provide the most accurate and detailed record of Kenya’s financial obligations.