Treasury CS: Cutting corruption by half would end need for external borrowing

Kenya can comfortably pay its external debt if the government cuts corruption-related losses by half, Treasury Cabinet Secretary John Mbadi has said.

Speaking on Citizen TV’s JKLive Show on Wednesday, Mbadi emphasized that the government’s fiscal consolidation efforts are aimed at increasing revenue while reducing excessive spending.

He identified public procurement as one of the major areas where the country loses significant funds due to corruption.

“We have talked about coming up with e-procurement because in procurement alone, we lose so much money,” he said.

Mbadi recalled a statement made by former President Uhuru Kenyatta, who once claimed that Kenya loses approximately Sh2 billion every day to corruption.

He explained that if even half of that amount was saved, the country could recover an estimated Sh365 billion annually.

“A lot of figures have been thrown around; remember the former president talked about us losing Sh2 billion per day. I made a joke one time which went viral, that if we could just reduce our theft by 50 percent,” Mbadi said.

He added that even though corruption should ideally be eliminated, reducing it by half would still have a major impact on the country's financial situation.

“If we are stealing Sh2 billion per day as an economy and we make a conscious decision that we steal a billion. If you had been stealing Sh1,000, you steal Sh500, although that is not desirable. I want it to be zero, but if we did that, we would be saving Sh1 billion per day, which translates to Sh365 billion per year,” he explained.

Mbadi noted that the amount lost to corruption every year is even higher than Kenya’s external debt for 2025, which currently stands at Sh280 billion.

He argued that curbing these financial losses would eliminate the need for foreign borrowing.

“That is the money we borrow externally. External debt this year alone is Sh280 billion, far much less than what we will save, so we will not go out there looking for money,” he stated.

The Treasury CS insisted that tackling corruption is crucial in addressing the country’s economic challenges.

He said ongoing measures such as digitizing procurement processes and strengthening oversight institutions are part of the government’s strategy to prevent financial mismanagement.

His remarks come at a time when Kenya is facing mounting debt obligations, with a significant portion of government revenue being used to service loans.

Concerns over rising debt levels have led to increased calls for better financial discipline and reduced reliance on borrowing.