Finance minister Njeru Githae has said Kenya has incurred a colossal Sh304 billion debt during the tenure of President Kibaki.
The
minister said Wednesday the borrowing spree that the country went into when
President Kibaki took over was to improve the country’s infrastructure and
to also grow the economy.
The
minister submitted a schedule of the debts that include the controversial naval
ship, the Nairobi-Thika super highway, the Sondu Miriu hydropower project, the
Geothermal power, the e-government project and dozens of other programmes in
the Treasury, the Ministries of Education, and the National Security
Intelligence Service.
The
money, the minister said, came from China, Japan, Korea the World Bank, the
International Monetary Fund, the Africa Development Bank, European Investment
Bank, Saudi Development Fund, the International Development Association, the
Arab Bank, among other creditors.
Mahmoud
Sirat (Wajir South) had asked for the schedule to find out if President
Kibaki’s administration had distributed the multibillion –shilling projects
fairly all over the country.
Donor
funds
“I
confirm that the funded projects using donor funds are prioritised in line with
the country’s development agenda and that they are distributed evenly in the
country,” said Mr Githae.
The
minister also told Parliament that the national public broadcaster was duped to
buy “obsolete” equipment from Japan, an action that has left the broadcaster
with a Sh22 billion hole in its books.
“The
Kenya Broadcasting Corporation has never remitted a single cent to the lender.
KBC has no money. It will be a waste of time to ask KBC to pay the loan,” said
Mr Githae.
James
Rege (Karachuonyo) sought to know if the minister had taken any steps to ensure
that the KBC loan was either converted into a grant or written off. The
minister said the Treasury was working on it.
“In
my view, the Japanese just dumped all the equipment in the country because they
were obsolete. In such a case, you don’t blame the lender, you blame the
borrower. It is sad that Kenya bought obsolete equipment,” said Mr Githae
The
loan from Japan for the Medium Wave (MW) equipment was a government guaranteed
loan.
Initially,
when the equipment was procured (in June 28, 1989), it was valued at Sh2.3
billion (16 billion Japanese Yen) at a rate of Sh7.4 cts/100 Yen and an
interest of 2.5per cent which was payable semi-annually.
When
the project was completed in 1994, the debt stood at Ksh 8.2 billion with an
exchange rate of Sh54/ 100 Yen. The fluctuation of the exchange rates therefore
caused the increase of the loan to Sh22 billion.
Source:
Daily Nation
