Adopt Sustainable Debt Management Strategies To Reprieve Ailing Economy
As a country, high debt burden continues to rampage an economy already facing a probable crippling. One of the ways we can salvage the economy is by adopting sustainable debt management strategies. A hypothetical approach by use of laymen’s theory would facilely point out high debt burden as a key and bloated cause of the economic tribulations Kenya is facing.
According to multiple Audit reports as of 2024, Kenya’s debt stood over KSH 10 Trillion, a few times our yearly budgets with significant budgetary allocation going to service high cost debts. The debt situation in Kenya continues to escalate due to the high cost of servicing external and domestic debts, over reliance on expensive loans, weak revenue collection structures , corruption and mismanagement of public funds.
If Kenya is to salvage the debt burden, we have to learn from Nations like Rwanda and Ghana who have in the past walked through the same valley of the shadow of economic turbulence.
For instance, Rwanda adopted strict fiscal discipline, economic diversification and improvement of revenue collection methods after the social, political and economic aftermath of the 1994 genocide.
On the other hand, Ghana faced a similar economic trajectory we’ve witnessed in Kenya recently due to high government expenditure and international borrowing. Although still facing other challenges like corruption, Ghana, through public spending cuts, economic reforms and debt restructuring managed to salvage the situation.
Similarly, in Kenya we also need to adopt like measures such as, controlled borrowing, debt restructuring and improved revenue collection methods which would significantly reprieve our economy. Otherwise if we continue to watch the situation deteriorate without taking any adoptive measures, we risk an economic strangulate which not only threatens state operations but even our very existence.
Victor Mutisya
Laikipia university
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