The government has revived plans to raise more funds for infrastructural development through the acquisition of a loan from Kenyans in diaspora.
In February this year, the National Treasury revealed that it was working with the World Bank and other multilateral lenders to structure a diaspora bond for Kenyans residing abroad.
However, the plans were temporarily put on hold after the government expressed jitters as to whether Kenyans in the diaspora would acquire the bonds.
The Prime Cabinet Secretary Musalia Mudavadi, while addressing Kenyans living in Namibia on Tuesday, September 10, revealed the government’s intention to raise more money through the sale of bonds to Kenyans abroad.
Prime Cabinet Secretary Musalia Mudavadi at the Football Kenya Federation Awards Gala on July 26, 2024.
Photo
Musalia Mudavadi
During the meeting, Mudavadi exuded confidence in the potential success of the plan even as he commended the diaspora citizens for their immense contributions in the previous years.
The Foreign Affairs CS further stated that the money raised from the sale of government securities would help raise more funds to bridge the budget deficit.
“But today, the figures indicate that Kenya is now ripe for a diaspora bond where you can help in investing in key infrastructure whether it is the roads, hospitals or institutions that matter and have a serious impact on the people,” Mudavadi stated.
“Cash sent home by Kenyans living abroad hit a record Ksh540 billion ($4.19 billion) in 2023, significantly boosting the country’s current account balance,” he added.
Mudavadi’s comments came days after the government revealed a huge budget deficit that has been caused by the withdrawal of the Finance Bill 2024.
Speaking at the launch of the Financial Year 2025/26 Budget Preparation Process earlier this week, Treasury CS John Mbadi enhanced austerity measures by reducing government expenditures.
Mbadi also proposed the reduction of the Value Added Tax(VAT) and other levies imposed on certain essential commodities.
“The government is committed to fiscal discipline. We aim to enhance transparency in our financial management systems and procurement processes,” Mbadi stated.
“Despite the fiscal constraints we are facing, we will ensure growth, expand opportunities, and prioritize sectors critical for economic recovery.”
Treasury CS John Mbadi signing for the loan facility, in Beijing on September 6, 2024.
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Treasury
