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{
    "id": 1275890,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1275890/?format=api",
    "text_counter": 414,
    "type": "speech",
    "speaker_name": "Sen. Oketch Gicheru",
    "speaker_title": "",
    "speaker": null,
    "content": "articulated by this Bill, is what we call the metric discipline. When the parliamentarians who came before us thought about borrowing, they came up with an absolute number and then they capped it to borrow up to Kshs10 trillion. However, what you lose sight of is that if the Kshs10 trillion was to be subjected to our Gross Domestic Product (GDP), what does it come up to? That is how we came up to realize that our debt situation is 64.1 per cent of our GDP. This is because we started by putting a number without realizing where we stand in terms of our GDP? Therefore, this debt relief Bill is going to help us to objectively put this debt borrowing mechanism of 55 per cent as a percentage of GDP, in its net present value. This means that at any given time we look at our GDP, and we want to borrow. As a country, we will look at what is our GDP at that particular point in time and then grow 55 per cent of that. I find this brilliant because it then helps us to put it as a performance metric. This will enable us to do three things that are very important for this country to manage our debt. First, if in any case we find that our economy is contracting, then it will mean that the percentage remains. Therefore, borrowing will become a constant and it also contracts. This is brilliant because that is the mechanism that will help us manage a debt that we cannot deal with. The good thing is that vice versa is also standing in the sense that, if the economy expands, it means that the gap and the window of borrowing that we have will expand. That would mean that it will be a development metric that forces us to start thinking about borrowing within some priority items, which for me will be very developmental. If you think about it, we are having exchequer receipts. Every single day, at the end of the week, the National Treasury has to think about paying for interest. Therefore, if we go with these metrics, it means that remains the same and true for interest. When the economy contracts, the interest also contract because we are pegging this to a percentage of our GDP rather than absolute value. Lastly, I invite the House to think about this critically. When we discussed this with the National Treasury and the Cabinet Secretary for Finance and Economic Planning, we told him that, if this is a good idea, how then do we come up with a compliance plan? The Cabinet Secretary together with our Committee worked very hard on this Bill to come up with absolute values. If we choose the matrix in this Bill, how do we come from 64.1 per cent down to a manageable level of 55 per cent, which we can constantly go with?"
}