Economic analyst Ephraim Njega has raised fresh concerns over Kenya’s fiscal trajectory, warning that the country is sliding into a prolonged economic crisis driven by rising debt-servicing costs, weak budget discipline, and political considerations in public finance management.
In a detailed social media post, Njega dismissed claims that analysts had predicted an abrupt economic collapse, arguing instead that collapse is a gradual process.
He said economies can be kept “on life support” for extended periods, creating an illusion of stability even as underlying conditions deteriorate.
Njega pointed to debt sustainability indicators, stressing that economic debates must be grounded in data rather than political rhetoric.
According to his analysis, public debt interest consumed 31 per cent of Kenya’s tax revenues in the year ending June 2022. By September 2025, that figure had risen sharply to 49 per cent.
“If nearly half of tax revenues are going into debt interest, the ability to fund basic government operations and development becomes severely constrained,” Njega noted, describing the trend as a clear fiscal crisis rather than a hypothetical risk.
He argued that the appropriate response would be budget rationalisation and aggressive anti-corruption measures to ensure the government lives within its means.
However, he criticised the current approach of selling public assets without reducing debt, warning that asset sales offer only temporary relief.
Njega further questioned the government’s decision to increase the national budget by 8.7 per cent, from KSh 4.3 trillion to KSh 4.6 trillion, while still planning net borrowing of KSh 1.1 trillion in the 2026/27 financial year.
He said this contradicted claims that asset sales are meant to curb borrowing.
The analyst cautioned that relying on financial engineering to resolve fiscal imbalances is unrealistic.
He warned that once assets are exhausted, governments face limited and painful options, including austerity, debt restructuring, money printing, or default—each with severe economic consequences.
Njega called for continued civic education on economic and governance issues, saying citizens need accurate information to prepare for potential shocks rather than politicised assurances of stability.