The amount that Kenya, Tanzania and Uganda would have to pay in debt servicing is almost the same as Tanzania's entire budget for 2020/21: Sh34.88 trillion.
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By the end of this month, Kenya's total public debt is expected to close the financial year at Ksh6.4 trillion (about Tsh134 trillion).
While Tanzania avoided contracting more debts to fight the Covid-19 pandemic, Kenya, Uganda and Rwanda embarked on a borrowing spree over the past two months, adding about $2.3 billion new loans in two months.
The parameters include: the ratio of total public debt to GDP; the value of external public debt to GDP; the value of external public debt to exports; the value of external public debt to exports; ratio of external debt servicing to domestic revenue and value of external debt service to exports.
"In the analysis, solvency indicators showed that the ratio of present value of total public debt to GDP was 27.1 percent compared to the recommended threshold of 70 percent; present value of external public debt to GDP was 16.3 percent compared to a threshold of 55 percent; and present value of external public debt to exports was 103.9 percent compared to a threshold of 240 percent," said Dr Mpango.
