Kenya’s freshly inaugurated 17-mile expressway, largely funded by China, stretches over Nairobi’s congested traffic with sparse usage, symbolizing the heavy toll of debt on the nation. This road, valued at nearly half a billion pounds, will only revert to Kenyan control once its cost is recouped through tolls set at around £3 per journey, a sum that remains out of reach for many Kenyans.
During recent protests in Nairobi, both China and global institutions like the IMF and World Bank faced criticism for Kenya’s debt load, though campaigners highlight the role of private banks and bondholders as equally significant creditors. Nearly half of Kenya’s external debt repayments between 2023 and 2025 are directed to private lenders, whose high-interest rates compound the country’s debt crisis.
Kenya’s external debt reached £27.7 billion by the end of 2022, quadrupling the budget allocated to critical sectors like healthcare and education. The latest Public Debt Register shows that American investment giants like AllianceBernstein and BlackRock collectively hold approximately $582 million (£450 million) of Kenyan government debt, while UK-based creditors, including HSBC and Aberdeen Asset Management, account for an additional $210 million (£161 million) in bond holdings.
A report reveals that between 2023 and 2025, Kenya’s repayments to private creditors will total £4.4 billion—close to three times what it owes international financial institutions like the World Bank. Bondholders demand higher interest rates than these institutions, making it costlier for the Kenyan government to borrow from private sources. In addition to soaring interest rates, loans from private creditors also come with the shortest repayment terms.
Across Africa, private bondholders claim substantial portions of national budgets. According to report’s findings, 32 out of 54 African nations now spend more on debt servicing than on healthcare—a statistic that has raised alarm among advocates for economic reform. The IMF and World Bank have urged Kenya to increase consumer taxes to meet these financial obligations, while the repayment structures for Eurobonds—private financial tools issued in foreign currencies—often lack transparency, leaving governments locked into cycles of borrowing and debt.
The high costs of servicing debts with international banks such as BlackRock, a major creditor to Ghana, Nigeria, and Zambia, reflect the challenge facing Kenya and other nations attempting to balance financial solvency with development needs. Christian Aid and other organizations continue to advocate for relief and restructuring to enable African countries to prioritize healthcare, education, and other essential services over debt repayments.
Debt repayments take priority for Kenya and several other African nations, leaving healthcare and public welfare at risk as they face complex financial decisions shaped largely outside their control in London and New York boardrooms.
