21 January 2016

Kenya's High Debt Levels Necessary for Infrastructure Spend - CBK

Kenya's high public debt level, currently around 54 per cent of GDP, is unavoidable as it is spending heavily on infrastructure to provide opportunities for its mostly young population, central bank deputy governor Sheila M'mbijiwe said on Thursday.

East Africa's biggest economy has borrowed heavily in recent years, including from multilateral institutions like the World Bank, to fund new infrastructure such as roads and railways.

"We have 60 per cent of our population below 30. We have to move fast to provide the opportunities for them tomorrow, and that's what we are doing," M'mbijiwe told an Africa forum in Johannesburg hosted by Frontier Advisory Deloitte.

"Was it the right time to take the risk, yes, the price of debt was low and if we had missed this opportunity when would we have gotten an opportunity? I don't believe we are very apologetic for that."

Kenya also tapped international capital markets in 2014 with a debut Eurobond and officials have said the country intends to remain active with new issuance.

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