Kenya’s inability to service its debt has been highlighted once more after it failed to repay the KSh 5.1 billion loan it obtained for the stalled Arror and Kimwarer dams.
According to the latest report by Auditor-General Nancy Gathungu, Nairobi defaulted on three loans advanced by international banks.
According to the report for the 2020/2021 fiscal year, Kenya was to repay KSh 790.7 million for the Arror dam, KSh 3.1 billion for the Itare dam, and KSh 1.26 billion for the Kimwarer dam.
“The credit agreements for these loans were not provided for audit review to confirm the terms of the loans and if the termination of the credit was conducted in accordance with the provisions in the respective agreements,” the report stated as reported by Daily Nation.
The construction of the arror and Kimwarer dams was estimated to cost KSh 63 billion, while the Itare dam was estimated to cost KSh 30 billion. They were intended to benefit residents of Elgeyo Marakwet and Nakuru, respectively.
Kenya’s debt now exceeds KSh 8.6 trillion. After parliament approved the Treasury’s proposal to raise the debt limit to KSh 10 trillion, the debt could exceed KSh 9 trillion.
The Arror And Kimwarer Dam projects were canceled after corruption allegations surfaced.
