Nairobi — The government is expected to ramp up its borrowing this year according to a report by Cytonn Investemnt raising more concerns about the country's already ballooning public debt.

According to the report, the government is set to borrow "aggressively" from both the foreign and domestic markets to plug the fiscal deficit, which is projected to be Sh768 bilion, equivalent to 4.3% of the GDP.

The report has further spotlighted that the government is expecting to receive more concessional financing from the IMF and the World Bank, and loans from commercial lenders.

The report, however, comes a month after the IMF called on Kenya to strengthen its fiscal framework and reduce debt vulnerabilities to improve the country's resilience against economic and climate shocks.

"I encouraged the authorities to continue efforts to create the fiscal space needed to finance priority investment and social spending, and make further progress in investing in human capital and greater inclusivity," said IMF Deputy Managing Director Nigel Clarke in December after he visited the country.

According to the Kenya National Bureau of Statistics, Kenya's external public debt now stands at Sh5.1 trillion by the end of September 2024.

The report further projects a stunted increase in revenue collection despite the steps executed by the Kenya Revenue Authority to guarantee an upward trajectory in revenue collection.

As of the end of November 2024, the total revenue collected by KRA stood at Sh940.9 billion.

"On revenue collection, we expect muted growth despite the reft of measures taken by KRA to increase tax through the implementation of the Finance Act 2023 which revised a number of taxes upwards and widened the tax base to include the informal sector in digital services and proposals to broaden the tax base through tax laws amendment Bill 2024," the report stated