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{
"id": 1524962,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524962/?format=api",
"text_counter": 899,
"type": "speech",
"speaker_name": "Hon. David Ochieng’",
"speaker_title": "The Temporary Speaker",
"speaker": null,
"content": " Next is the Member for Kitui Central."
},
{
"id": 1524963,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524963/?format=api",
"text_counter": 900,
"type": "speech",
"speaker_name": "Kitui Central, WDM",
"speaker_title": "Hon. (Dr) Makali Mulu",
"speaker": null,
"content": " Thank you, Hon. Temporary Speaker. From the outset, I thank the Liaison Committee for a job well done. It is not always easy to go through the Medium-Term Debt Management Strategy and come up with recommendations. I have looked at the report and it really brings out very important issues regarding managing our public debt. I want to focus on three issues which have been captured in the report. First is the issue of the ratio being above 55 per cent, as approved by this House. The intention was that by 2028, the Government, through fiscal consolidation, will be able to bring this ratio back to either 55 per cent or below 55 per cent. However, with the way things are, I can say without any fear of contradiction that if we do not change our attitude towards how we spend our money as a country, we will never be below 55 per cent. As recommended by this report, this is a matter that the National Treasury should take seriously. We need to work towards bringing this figure to below 55 per cent. Second is the ratio of domestic debt to external debt. The current proposed ratio is 35 per cent for external debt and 65 per cent for domestic debt. If you look at the statistics of our debt repayment, particularly interest repayment, you will realise that even though domestic debt is about 51 per cent and external debt is about 49 per cent, 70 per cent of the total annual interest paid goes to domestic debt, while 30 per cent goes to external debt. In simple terms, we are saying that domestic debt is very expensive. The way forward to help this country is to go slow on domestic debt and increase external debt. We know the challenges the country is facing in accessing external debt, but I believe it is the responsibility of the Kenya Kwanza Government, through the National Treasury, to ensure that they do what it takes to reduce domestic borrowing and increase external borrowing. In that case, we would be helping the country. The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
},
{
"id": 1524964,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524964/?format=api",
"text_counter": 901,
"type": "speech",
"speaker_name": "Kitui Central, WDM",
"speaker_title": "Hon. (Dr) Makali Mulu",
"speaker": null,
"content": "The third point is the issue of the Treasury Single Account. This has become a song in this Republic and in this House. You and I have served in the Budget and Appropriations Committee for a long time, and the Treasury Single Account is something we have talked about for over 10 years. I always wonder why we cannot implement the recommendation to operationalise the Treasury Single Account. I see a recommendation that it should be done by 1st July 2025. How I wish this time, this House will enforce that recommendation so that by 1st July 2025, we will be talking about a Treasury Single Account. There are very many benefits which accrue to that account, and this country will benefit in a bigger way if we move in that direction. Lastly, Hon. Temporary Speaker, is the issue of the digitisation of our public debt. The other day, you saw in the newspaper that this country has been operating a manual system. Kenya prides itself on being the regional leader. You have heard the stories about Tanzania and Uganda. Our neighbours are doing better in managing public debt, and the reason they have gone digital is to reduce issues of corruption. The longer we remain on a manual system, the more we open wide doors for corruption. We should take the migration of our public debt management from a manual system to a digital system seriously. With those many remarks, I support this Report."
},
{
"id": 1524965,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524965/?format=api",
"text_counter": 902,
"type": "speech",
"speaker_name": "Hon. David Ochieng’",
"speaker_title": "The Temporary Speaker",
"speaker": null,
"content": " Next is Hon. Mutunga."
},
{
"id": 1524966,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524966/?format=api",
"text_counter": 903,
"type": "speech",
"speaker_name": "Tigania West, UDA",
"speaker_title": "Hon. (Dr) John Mutunga Kanyuithia",
"speaker": null,
"content": " Thank you, Hon. Temporary Speaker, for the opportunity to add my voice to this very important debate in support of the adoption of the Liaison Committee Report on the Medium-Term Debt Management Strategy for 2025/2026. Borrowing is a necessity; it is not a bad idea. As many have spoken to it, rarely will you find countries that do not borrow. Individuals who do not borrow, do not grow fast. So, borrowing is not really a bad thing. The borrowing strategy is anchored on macroeconomic indicators outlined in the 2025 Medium-Term Debt Management Strategy. The strategy is backed by stable inflation rates. Kenya is experiencing some of the lowest inflation rates in over 10 years. On the other hand, it is also anchored on robust economic growth, which is abridged at around 5 per cent. It is also anchored on stable exchange rates and we can clearly attest to the fact that our exchange rates are not bad. The shilling has strengthened to between Ksh128 and Ksh130, depending on where you seek for exchange. Additionally, it is anchored on favourable global economic conditions, which we may not have full control of, and also strong revenue collection. This country has been doing very well in terms of revenue collection, and even if we sometimes miss the point, it is not by a great percentage. The Medium-Term Debt Management Strategy is also strongly based on the planned reduction of the fiscal deficit, being the difference between what the country can support and what needs to be sourced outside. This reduction basically harnesses revenue collection, which has been taken care of while limiting unproductive expenditure growth. Let me very briefly talk to the fact that the 2025-2026 Medium-Term Debt Management Strategy proposes that Kenya will borrow Ksh831 billion, which represents the deficit between the total revenue collected and the budgeted amount. The total projected domestic borrowing is projected to be 65 per cent. Many of us have spoken to that fact. It is expensive to borrow locally. However, the medium-term proposals or projections indicate that Kenya will be borrowing externally at a rate of about 45 per cent, which will bring down our borrowing to 55 per cent. That is within the acceptable limits. That reduction is key because it will also come with a lot of cost reduction. We will be borrowing from outside through concessional borrowing at a rate of 14 per cent, semi-concessional borrowing at around 3 per cent, and commercial borrowing at 8 per cent. For that to happen, certain factors must be put in place. That is why we cannot borrow a lot externally. As I mentioned, we need stable exchange rates. Macro-fiscal variables that The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
},
{
"id": 1524967,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524967/?format=api",
"text_counter": 904,
"type": "speech",
"speaker_name": "Tigania West, UDA",
"speaker_title": "Hon. (Dr) John Mutunga Kanyuithia",
"speaker": null,
"content": "influence international credit must also be in our favour, which will allow Kenya to access external debts at acceptable rates. The better our credit rating is, the more we can be seen as a preferred investment destination, and the more we can bargain. The Medium-Term Debt Management Strategy takes into account several challenges, which I would like to highlight. One of them is the sovereign credit rating. The future credit rating gives Kenya a positive outlook, which means we are stable. The other one is the external factors which control market volatility. That influences the timing and the cost of the debt operations themselves. There are also increased debt servicing costs, which are important. Having noted those challenges, the Strategy goes further…"
},
{
"id": 1524968,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524968/?format=api",
"text_counter": 905,
"type": "speech",
"speaker_name": "Hon. David Ochieng’",
"speaker_title": "The Temporary Speaker",
"speaker": null,
"content": " I will give you 30 seconds. You do not have the whole..."
},
{
"id": 1524969,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524969/?format=api",
"text_counter": 906,
"type": "scene",
"speaker_name": "",
"speaker_title": "",
"speaker": null,
"content": "(Hon. (Dr) John Mutunga Kanyuithia spoke off the record)"
},
{
"id": 1524970,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524970/?format=api",
"text_counter": 907,
"type": "speech",
"speaker_name": "Hon. David Ochieng’",
"speaker_title": "The Temporary Speaker",
"speaker": null,
"content": "You should not be highlighting anything. You should be winding up."
},
{
"id": 1524971,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1524971/?format=api",
"text_counter": 908,
"type": "speech",
"speaker_name": "Hon. (Dr) John Mutunga Kanyuithia (",
"speaker_title": "",
"speaker": null,
"content": "Tigania West, UDA): Hon. Temporary Speaker, let me wind up by saying that the Strategy indicates an approach to those challenges. It does not just appreciate that there are challenges; it also gives an approach to dealing with those challenges. First, is to centralise trade to a single trade repository. That will help us to do better price discovery, which will help us in preparedness. The other one is to operationalise the Sinking Fund, which will help us to reduce the risk of borrowing. Finally, is the improvement of cash management, which will help us to contain the use of overdrafts. Overdrafts are normally very expensive. The other strategy is to sustain fiscal consolidation, which has been happening in the country, and is moving towards the reduction of public debt accumulation. With those very few remarks, I support the adoption of the Report."
}
]
}