Treasury alarmed by State agencies' borrowing as loans hit Sh41 billion

Finance Cabinet Secretary Henry Rotich (right) and Africa Development Bank regional director Gabriel Negatu after signing a memorandum of understanding for the Last Mile Connectivity Project (LMCP) which aims to support the Government's initiatives of ensuring increased electricity access to Kenyans, particularly among the low-income groups [PHOTO/BEVERLYNE MUSILI/STANDARD]

Nairobi, Kenya - Borrowing by State-owned entities with or without Government guarantees is increasing liability risks to the government. This is because in the event of default, the State bears the debt.

The Treasury cautions that with devolution, liabilities are expected to rise as those of county governments are taken into account, calling for closer monitoring.