Economists, mmeona hii?


Village Elder
Ati ile pesa yote Ounye amekua akikopakopa hapa na pale kama malaya akikopa sigara kwa kiosk sasa ni wakati wa kulipa. Swali langu ni, is the situation really that bad ama ni hawa watu wa kufunga nyama wanaiblow out of proportion?

Story yenyewe iko hapa for the Click battalion.
Creditors come knocking as Kenya heads to repeat presidential election
The first headache for the winner of next month’s repeat presidential polls will be the impending repayment of a $700 million (Sh77.4 billion) syndicated loan amid rising concerns about the country’s creditworthiness. It is still unclear how the National Treasury plans to pay the syndicated loan that matures next month even as the country’s debt situation becomes more worrisome.

Last week, credit rating agency Moodys said the ruling by the Supreme Court invalidating last month’s election of President Uhuru Kenyatta was a negative credit for the country. Although there is no real risk of default since the Government could borrow from the domestic market or get money from the taxman to settle the loan, lack of a substantive head of State has cast uncertainty on the matter. Already, the Government has revealed it plans to sell a two-year and 10-year Treasury bond worth Sh30 billion ($292 million) this month, although it is not clear whether the move is tied to the impending loan repayment.

New bond issue
Central Bank said on Sunday in a statement said it would receive bids for the bonds until September 19 and auction the two bonds on September 20. Treasury officials declined to comment when asked about the loan arranged by Citigroup, Standard Bank and Standard Chartered secured in 2015, an indication of the uncertainty in the country’s debt market. “The market speculates the Government will pay from the Central Bank reserves or Treasury will get a moratorium like they did in 2014 for about six months within which they can go into the international markets,” a market analyst who did not want to be named told The Standard. Kenya has been paying interest and costs of about Sh12 billion annually on the two-year loan taken at eight per cent, but now the principal amount has come up for repayment. The source said they expected the loan repayment to happen in the first quarter of next year. This raises questions on whether the Government is already negotiating for a grace period and the cost to the taxpayer. “There is nothing to suggest that a moratorium clause is not included in the current deal,” the source said.

Debts directly arranged by a number of banks called syndicated loans have been controversial in Kenyan whenever they come up for settlement. In 2014, Treasury tried to negotiate with a group of international banks to roll over the repayment of a $600 million (Sh52 billion) syndicated loan borrowed in 2012 by three years. It, however, only managed a six-month extension, having also set preconditions to pay within seven days of receipt of proceeds from the $2 billion (Sh204 billion) sovereign bond. It was this syndicated loan that created a lot of controversy after Treasury paid the money from offshore accounts, which is against the country’s laws. Treasury had claimed the move was to save the country more than Sh1 billion from converting the dollars to shillings and then back into dollars. The Jubilee Government has taken three syndicated loans - a $700 million (Sh71.4 billion) facility arranged by Standard Bank in October 2015, $250 million (Sh25.8 billion) from Trade Development Bank and another $500 million (Sh51 billion) from Qatar National Bank (QNB), Emirates NBD and Afriexim Bank earlier this year.

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GOK development will come to a screeching halt in a few years, if they continue with the current rate of borrowing loans and at the same time finding new and better ways of the taxman milking wanjiku dry. The taxman taps will dry up in a few years wakiendelea na hii mchezo.
Considering that KRA collects like 1.4tr, this represents 5% of KRA's collection.
Judge for yourself kama ni mingi ama ni kidogo.
The total public debt is 4 trillion and is still steadily rising, that is why even with the KRA 1.4 trillion collection we are slowly going down the wrong path. And KRA has been missing its tax targets, that is why everyday they are busy implementing new ways of milking mwananchi like the recent 20K fines for not filing tax returns.