Lawyer Willis Otieno has raised critical concerns following Treasury Cabinet Secretary Hon. John Mbadi’s revelation that Kenya’s public debt stands at Ksh 11.81 trillion (67.8 percent of GDP) as of June 2025.
Mbadi disclosed that the debt, comprising Ksh 6.33 trillion in domestic obligations and Ksh 5.48 trillion in external debt, is sustainable but carries a heightened risk of distress.
However, Otieno has challenged the Treasury to clarify whether this figure fully accounts for off-balance sheet liabilities, questioning the transparency of the reported debt metrics.
“How does the Treasury reconcile the Ksh 11.81 trillion nominal debt figure with off-balance sheet liabilities, such as pending bills, government guarantees to parastatals, and public-private partnership (PPP) commitments?” Otieno asked.
He further queried whether Kenya’s definition of “public debt” aligns with the International Monetary Fund’s Government Finance Statistics Manual (GFSM 2014), which mandates comprehensive reporting of all government liabilities.
Otieno expressed skepticism about the exclusion of contingent liabilities, arguing that pending bills and guarantees to state-owned enterprises could significantly inflate the true debt burden.
“Without clarity on these obligations, the public is left in the dark about the full extent of our fiscal exposure,” he stated.
Mbadi had outlined that the government spent Ksh 1.72 trillion on debt servicing in 2024/25 and is pursuing liability management strategies, including refinancing high-cost debts and prioritizing concessional loans.
Yet, Otieno warned that without transparent accounting, such measures may fall short of addressing systemic risks.
He urged the Treasury to publish a detailed breakdown of all liabilities, including PPPs, to foster accountability.
Mbadi’s commitment to monthly briefings with journalists was welcomed by Otieno, who called for these engagements to address such discrepancies and enhance public trust in Kenya’s fiscal management.