When he visits Beijing later this month, Kenyan President William Ruto plans to seek China for a $1 billion loan to finish blocked road projects, according to his deputy Rigathi Gachahua.
Gachahua stated on the community radio station Inooro FM that Ruto will also request a longer repayment period for the money already owed.
Kenya presently owes Chinese lenders more than $8 billion.
After his coalition earlier opposed his predecessor Uhuru Kenyatta’s borrowing binge from China, Ruto’s plan represents a significant change in his position.
- Unpaid bills
The Nairobi highway was one of the infrastructure projects that Kenyatta used the Chinese loans to finance. However, many of these projects have already come to a standstill as contractors leave them because of unpaid payments.
“If we get $1 billion we can be able to give these people [contractors] the money they are owed so they can return so even as we pay the debt, the roads are completed,” Gachahua said.
The deputy said Ruto will ask Chinese officials if Kenya can be given more time to repay the debts.
- Belt and Road Initiative
Kenya was one of many African nations that were the focus of China’s Belt and Road Initiative, an ambitious initiative that President Xi Jinping introduced in 2013 to increase Chinese geopolitical and economic power by promoting the development of global infrastructure.
Before Chinese financing began to slow down in 2019 though, there was a boom in loans to nations like Kenya, which infuriated opponents and increased debt loads and the accompanying pressure of repayment.
According to official figures, the Kenyan government is straining its finances by using approximately half of its revenue to pay off debts that are coming due. Repayments of foreign debt and a sharp depreciation of the kwacha have made the situation worse.
Tuesday, in an effort to control spending, the president’s office placed some restrictions on government officials’ travel abroad. The cabinet also ordered all departments to make a 10% budget cut.
“It is true that many people have been travelling abroad, spending a lot of money, and that is why the president ordered that even ministers and governors can only travel with two people,” Gachagua said.
