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{
    "id": 1119233,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1119233/?format=api",
    "text_counter": 310,
    "type": "speech",
    "speaker_name": "Sen. Kibiru",
    "speaker_title": "",
    "speaker": {
        "id": 13196,
        "legal_name": "Charles Reubenson Kibiru",
        "slug": "charles-reubenson-kibiru"
    },
    "content": "It is important that the National Treasury has already entered into commitment worth about Kshs1.13trillion. As such, the provided borrowing space is already locked into loans commitment. That is what I meant when I said that we may have exceeded this. Surprisingly, this, therefore, brings the total debt stock, dispersed and non-dispersed, to Kshs9.02 trillion, which is beyond the approved ceiling and leaves no space for new debt. As we do all the other issues, we may be declared an ongoing concern as a country. The continued existence of this fiscal deficit indicates a lack of fiscal commitment required to maintain the budget deficit on declining trends as provided in the fiscal consolidation path, whose parameters are set annually through the Budget Policy Statement (BPS). The East African Community Convergence Criteria encourages member states to ensure their deficit is below 3 per cent of the GDP. It is important to note that the country is always in the vicious cycle of budget deficit, having achieved a budget surplus only once in the FY 1999/2000, which amounted to Kshs3.3billion or 0.04 percent of the GDP. The composition of the debt, as we found out, is that we have both domestic and external debts. Domestic debt is worth about Kshs3.69 trillion and accounts to 48 per cent of the total debt stock. This is largely owned by commercial banks. No wonder banks continue making huge profits even when other businesses are complaining that they are going down because of the pandemic. Banks are laughing all the way. Non-bank institutions such as pension and insurance companies own about 48 per cent. Domestic debt is critical cash flow management, maintaining depth of domestic financial market and for cushioning the economy against erratic external vulnerabilities. However, a higher percentage of domestic debt indicates a high risk exposure of the domestic financial market should debt servicing concerns arise. So, we will be hard hit especially in the finance market if for one reason or another we start behaving like a country in the southern part of Africa."
}