Treasury misses Ksh.147 billion loans at lapse of financial year

The National Treasury is set to go without Ksh.147 billion in expected loan disbursements as the 2021-2022 financial year draws to a close on Thursday.

The exchequer is for instance yet to complete the issuance of an estimated Ksh.117.8 billion ($1 billion) syndicated loans from the international capital markets.

Additionally, the International Monetary Fund (IMF) has delayed the disbursement of Ksh.28.7 billion ($244 million) representing the third tranche of a greater three-year program loan with Kenya.

The government had been awaiting the disbursements before June 30 to finance the budget deficit for the closing fiscal year.

Despite insisting the issuance of the syndicated loan remains on course, Treasury Principal Secretary Julius Muia did not commit on when the disbursement of the commercial loan would be made within a day to the close of the financial year.

“We are out there in the market and we know that we will get our money in good time but I wouldn’t commit on a date. We are out there and the prospects are good,” PS Muia said on Wednesday.

At the same time, Dr. Muia said disbursements from the IMF are expected early in the new financial year which starts Friday.

“We are in a very good working relationship with the IMF and our program is going very well. There is a delay for a week or two but the program is going on well and I don’t see any challenge whatsoever,” he added.

Despite the missed disbursements, the National Treasury does not appear to be in any cash-crunch even if it may be forced to postpone some expenditures to the next fiscal year.

For instance, disclosures from the Actual Statements on Revenues and Net Expenditures by the National Treasury as of May 31 show the exchequer balance stood at Ksh.51 billion going into June.

At the same time, the National Treasury tapped Ksh.19.6 billion from a bond tap sale earlier this month to go alongside Ksh.73.8 billion raised from the sale of an infrastructure bond at the start of June.

Moreover, tax revenues are expected to come in in-excess of targets for the 2021-2022 financial year.

The tax receipts were only Ksh.103 billion shy of the Ksh.1.741 trillion target going into June.