Kenya’s public debt has reached Ksh11.81 trillion, equal to 67.8 per cent of GDP, as of June 2025.

Treasury Cabinet Secretary John Mbadi disclosed the figures on Tuesday, October 7, 2025, saying the debt remains sustainable but carries a heightened risk of distress.

“Cabinet Secretary Hon. FCPA John Mbadi today briefed financial journalists on the status of Kenya’s public debt, disclosing that it stood at Ksh 11.81 trillion (67.8 percent of GDP) as of June 2025,” the National Treasury posted on their X account.

Out of the total amount, Ksh6.33 trillion represents domestic debt, while Ksh5.48 trillion is owed to external creditors such as the World Bank, the African Development Bank (AfDB), China, and Eurobond holders.

During the 2024/25 financial year, the government paid Ksh1.72 trillion in debt servicing, Ksh1.14 trillion to domestic lenders and Ksh579 billion to foreign creditors. Mbadi said the Treasury is taking steps to manage the country’s debt more effectively and reduce future risks.

To ease pressure on repayments, the Treasury has started refinancing high-cost loans, extending debt maturities, and increasing the use of concessional financing. Mbadi said these actions aim to improve Kenya’s debt sustainability and restore fiscal space for growth.

He reaffirmed that sound and prudent debt management is at the heart of his leadership at the Treasury.

Fiscal stability

Under the 2025 Medium-Term Debt Management Strategy, the government plans to lengthen the maturity profile of public debt and limit exposure to fluctuating interest and exchange rates. About 75 per cent of new borrowing will come from the domestic market, with 25 per cent from external sources.

Mbadi also said Kenya’s debt-to-GDP ratio is expected to decline gradually in the medium term as fiscal reforms take effect.

He announced plans to hold monthly briefings with financial journalists to promote transparency and improve public understanding of debt issues.

The latest figures come a day after Mbadi outlined efforts to improve Kenya’s credit ratings. On Monday, he told financial experts in Mombasa that stronger credit ratings would help Kenya access cheaper loans, attract more investors, and lower borrowing costs.

Mbadi said reforms under the Finance Act 2025, including improved tax compliance and early Eurobond repayments, are part of the government’s plan to strengthen fiscal credibility and build investor confidence.