State targets coffee, sugar debts in new budget plan

Speaking during a press briefing, Mwaura said Ksh 2 billion has already been allocated in the current budget to begin settling the debt owed to coffee farmers.

He added that the government is also addressing outstanding obligations in the sugar sector, with a similar allocation aimed at easing a KSh 10 billion debt burden.

“The government is clearing Ksh 6.8 billion of debt in the coffee sector by allocating Ksh 2 billion in the current budget. Additionally, Ksh 2 billion has been set aside for the sugar sector, which has a Ksh 10 billion debt,” Mwaura said.

On energy, Mwaura reiterated the government’s commitment to expanding the country’s installed power capacity from 3,271 megawatts to at least 10,000 megawatts within the next five years.

As part of efforts to diversify energy sources, he noted that the state is fast-tracking the development of nuclear power plants in Kilifi and Siaya counties.

“The Siaya project is expected to begin in March 2027 and will create between 5,000 and 12,000 jobs during construction, alongside permanent technical positions once operational,” he added.

Addressing the country’s economic outlook, Mwaura commended government measures aimed at maintaining stability, noting that inflation has remained relatively low in the first four months of the year. He attributed this to fiscal discipline, improved debt management, and targeted sector interventions, which have helped keep inflation at 5.3 percent between March and early April.

He said the stable inflation rate has contributed to lower food and energy costs, as well as the strengthening of the Kenyan shilling against the US dollar.

“Real GDP growth is projected at 5.5 per cent for the 2025/26 financial year, higher than the global average, supported by a strong agricultural recovery and a robust services sector,” Mwaura noted.

The spokesperson also highlighted growth in the tourism sector, which recorded 7.9 million visitors last year, marking a 9 per cent increase, well above the global average of 4 per cent. Domestic tourism grew by 5.2 per cent, while international arrivals rose by 2.7 per cent.

He attributed this growth partly to the introduction of the Electronic Travel Authorisation (ETA) visa-free regime and ongoing improvements in Kenya’s tourism offerings.