Kenya’s public debt burden is once again under scrutiny after Treasury records showed that the government spent about Sh5.9 trillion on servicing public debt during the 2025/26 financial year.
The amount covered the repayment of principal sums, interest payments and other costs linked to both domestic and external borrowing.
The figure has raised fresh questions about how much of the country’s revenue is being directed towards existing debt obligations and how much remains available for development and essential services.
Debt servicing refers to the money the government uses to repay borrowed funds and meet interest charges.
For Kenya, the cost has become an important part of public finances as the country continues to rely on borrowing to support government operations and development programmes.
When a large portion of government revenue goes towards debt payments, fewer resources are left for other needs.
These include improving roads, expanding healthcare services, supporting education, investing in agriculture and creating an environment where businesses can grow.
The Sh5.9 trillion figure also highlights concerns over the possibility of continued borrowing creating pressure on future budgets. Critics argue that if new loans are increasingly used to meet previous financial obligations, the government can find itself with less room to fund projects that directly benefit citizens and strengthen the economy.
Kenya’s debt comes from both local and foreign sources. Domestic borrowing includes money raised from local banks, pension funds and investors through instruments such as Treasury bills and bonds.
External borrowing involves loans from international institutions, foreign governments and commercial lenders.
The two forms of borrowing present different challenges. External debt can become more expensive when the Kenyan shilling loses value against major international currencies.
Domestic borrowing can also affect the local financial market by influencing interest rates and the amount of money available for businesses seeking credit.
The high cost of servicing debt therefore places pressure on the government to carefully manage public finances. Borrowing can provide funds for important development projects, but excessive debt can limit the government’s ability to respond to other priorities.
For ordinary Kenyans, the effects can be felt through government decisions on taxation and public spending.
Businesses can also be affected when government borrowing puts pressure on local credit markets. At the same time, reduced investment in productive sectors could limit opportunities for young people and slow economic growth.
The Sh5.9 trillion reported in debt servicing underlines the importance of responsible borrowing and stronger financial planning.
The government faces the challenge of raising enough revenue, controlling unnecessary spending and ensuring that borrowed money is used productively.
Greater transparency over public borrowing and spending can also help citizens understand how government resources are being used.
Growing the economy and improving revenue collection without placing excessive pressure on households and businesses will be important.
Managing public debt will remain a major economic issue. Reducing the pressure created by debt payments would give the government more room to invest in services and programmes that have a direct impact on the lives of citizens.
