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{
    "id": 509170,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/509170/?format=api",
    "text_counter": 253,
    "type": "speech",
    "speaker_name": "Hon. Katoo",
    "speaker_title": "",
    "speaker": {
        "id": 199,
        "legal_name": "Judah Katoo Ole-Metito",
        "slug": "judah-ole-metito"
    },
    "content": "Hon. Speaker, I stand to second this very important Motion. The Mover has ably given the justification for the raising of the ceiling. I want to second the Motion by also trying to put some points across on its justification. This is a noble idea and it is doable. From the outset, Kenya’s overall net public debt to the GDP ratio has declined over the last two years as a result of prudent financial policy and a stable macro- economic environment. This is based on the report by the IMF and the World Bank that says that, at the end of the year 2012, that ratio stood at 43 per cent down from the 48 per cent at the end of 2011. This is the comparison being given across the region in countries like Zambia, Ghana, Tanzania, Uganda, Rwanda and Burundi, with the highest in that comparison being Ghana at 53.1 per cent. Therefore, in the overall, the public debt is almost evenly split between both the domestic and the external creditors. It is also good to know that the external debt sources remain to be the multi-lateral and bilateral partners. Some of those multilaterals are the International Bank for Reconstruction and Development and the International Development Association. Their concerns are on project lending. Others are the World Bank, the IMF, the European Investment Bank and the African Development Bank. The IMF mostly deals with policy based lending to do with Budget support. These are areas that we are talking about in terms of where to get external borrowing. The leading bilateral lenders are mostly Japan, France and China. Therefore, it is also good to note that most of our external debt remains on concessional terms although the commercial component has also increased of late. From 2011/2012, the shares of both multilateral and bilateral creditors or the credit sources have been on the decline. I still want to believe that this is justified. It is a cost that we can afford as a country. It is also worth noting that Kenya has not benefitted from any debt relief initiative. This is to say that we have been able to service our debt. This is not because we have received any debt relief initiative, but it is because of the sound fiscal management of the economy which we encourage the National Treasury to continue doing. It is also worth noting that for the first time, Kenya has received a rating of a B+ (plus) with a stable outlook. This should enable the country to negotiate for a favourable rate on external borrowing. That good score is also another element that can encourage us to go forward or upward on external debt. If you look at the IMF and the World Bank report of the last debt sustainability analysis, which was published in December, 2011, it says that the Kenya debt outlook has strengthened. We have been having some weak projected economic growth. All the time, we project having a double digit economic growth rate and we have not achieved it. However, despite all that, all debt indicators have improved as a result of the lower fiscal and more favourable exchange rate development. Therefore, if that trend continuous, I believe that this Motion is tenable and doable."
}