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Ruto heads to Beijing ‘for more Chinese loans’

President William Ruto will travel to China to negotiate the repayment period of a Chinese loan to Kenya.

Deputy President Rigathi Gachagua revealed this during an interview with Inooro FM on October 6, 2023.

He explained that road projects initiated by the previous administration have stalled due to the debt owed by the Kenyan government to the contractors.

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China financed road construction projects, with many of the contractors being Chinese companies.

In addition to seeking an extension of the loan repayment period, Gachagua has disclosed that President Ruto will request further funding to settle contractors’ outstanding debts.

Gachagua stated, “The President is set to travel to China to negotiate an extension of the repayment period for the loan we owe China. He will also request an additional $1 billion (USD), equivalent to Sh148 billion, in funding to settle the contractors’ debts. We acknowledge our indebtedness to China, and we are committed to honoring our financial obligations. The President will engage in discussions to explore the possibility of extending the repayment period.”

This appears to be against the stance by the Ruto administration to reduce on borrowing.

Kenya currently owes China more than $8 billion (approximately Sh1.19 trillion) in loans for infrastructure projects, including railways and roads.

However, the Deputy President lamented that Kenyan citizens are burdened with debt payments through heavy taxation and levies for roads from which they do not directly benefit.

He explained that the foreign debts being serviced by the Kenya Kwanza government were incurred during the tenure of former President Uhuru Kenyatta.

Dr Ruto served as the Deputy to Mr Kenyatta.

“We are repaying debts for roads that are incomplete. Many of these projects were initiated during the presidency of His Excellency Uhuru Kenyatta and were funded through loans,” stated the Deputy President.

He pointed out that road construction came to a halt when the borrowed funds were exhausted, leaving many projects unfinished.

“Contractors stopped working until their dues were paid. We need to get these projects back on track.”

The Sh148 billion that President Ruto intends to borrow will be utilized to settle outstanding contractor debts and provide additional funding for the continuation of infrastructure construction projects.