Treasury Cabinet Secretary John Mbadi has credited President William Ruto’s administration with helping Kenya avoid a sovereign debt default, saying the country faced serious financial pressure when the government took office in 2022.
Speaking in Kisumu on Sunday, Mbadi said Kenya was among six African countries that had been identified by the International Monetary Fund (IMF) as being at risk of default.
According to the CS, five of the countries subsequently defaulted, while Kenya avoided the same outcome through measures to manage its debt obligations and refinance maturing liabilities.
“If it were not for you, this country’s economy would have fallen flat. We would have lost our credibility in the league of this continent,” Mbadi told Ruto.
How the government says it managed the debt pressure
Mbadi said the government had adopted a strategy of managing its liabilities well into 2032, including restructuring obligations and preparing for major debt repayments.
He defended the use of Article 223 of the Constitution to authorise expenditure outside the approved budget where necessary, saying he would continue using the provision when it was required to protect the country’s financial position.
The government has also pursued liability-management operations to spread repayment pressures rather than allowing large obligations to fall due at once. Treasury documents identify liability management, concessional financing and fiscal consolidation as part of Kenya’s medium-term debt strategy.
Mbadi pointed to the sharp depreciation of the shilling during the period as another indication of the economic pressures Kenya faced. He recalled the currency falling to around KSh160 against the US dollar.
Kenya still faces a heavy debt burden
While Mbadi presented the avoidance of default as a major achievement, Kenya’s debt position remains under pressure.
Public and publicly guaranteed debt stood at about KSh13.01 trillion at the end of June 2026, up from roughly KSh8.7 trillion when Ruto took office in September 2022.
The Controller of Budget has warned that rising debt, budget deficits, high debt-service costs and refinancing needs are putting increasing pressure on public finances.
Treasury’s latest medium-term debt strategy says Kenya’s debt remains sustainable but carries a high risk of debt distress, underscoring the challenge facing the government even as it seeks to avoid default.
Mbadi links debt strategy to development
The Treasury CS also used his Kisumu appearance to defend the government’s development record in Nyanza.
He argued that regions such as Nyanza and northern Kenya had historically received less development attention and said the Ruto administration was changing that approach.
“Nyanza is not a minority. We are majority. We are many people in this country. But in terms of development, for some reason, historically, this region has been viewed and treated like we don’t belong to this country,” Mbadi said.
He cited the planned extension of the Standard Gauge Railway from Naivasha towards Kisumu and Malaba as one of the projects he believes could transform the region.
JOOTRH gets national government backing
Mbadi also highlighted the elevation of Jaramogi Oginga Odinga Teaching and Referral Hospital (JOOTRH) to a Level Six facility.
He said he found a Cabinet memorandum on the upgrade that had remained unsigned for several years and took the matter to Ruto before it was approved.
According to Mbadi, the national government will allocate more than KSh4 billion to support the facility, reducing the financial burden on Kisumu County.
“The national government will be allocating money, Sh4 billion, to make sure that our people get treated,” he said.
Mbadi further said the government had signed an agreement with the World Bank for the Lake Victoria Ring Road, which he said would connect Busia to Muhuru Bay and cover more than 800 kilometres.
For the Ruto administration, the message is that debt management and development spending can proceed together. But with public debt now above KSh13 trillion, the government faces continued pressure to demonstrate that its borrowing and repayment strategy can remain sustainable.
