The economic crisis in Kenya seems to have no end or anchors of salvation.
Yesterday's news is that the state does not have the money to pay the salaries of thousands of civil servants. Many of them have yet to receive their March salaries, and Treasury Minister Njuguna Ndung'u candidly admitted that "times are tough" and that even in the immediate future there is no glimmer of relief from this problem. Responding to those who lamented the serious problem, which affects state workers and parastatals with the exception of teachers, and confessing to the severe liquidity crisis, Ndung'u said the national government is facing financial constraints because it is caught between insufficient revenues and limited access to financing due to the shrinking debt margin.
The concern, in addition to being on the tables and in the daily needs of so many households, is also landing in the offices of Kenya's major banks and lending cooperatives (the so-called "Sacco" - if you want to know what they are and how they work read this interesting article). The private financial organizations are wondering how hundreds of customers who have taken out mortgages and loans will manage to honor their monthly payments, without being able to draw a salary.
"We usually get paid between the 27th and 30th of the month," said an employee of the state-owned TV station, the Kenya Broadcasting Company (KBC), "we are on the 10th of the next month and they still have not arrived.
The situation is also worrying for health and security, the main sectors that cannot be left uncovered or fall victim to strikes. "Since our country's independence, we have never seen something like this," said MP Peter Salasya, "not even during the time of former President Daniel Arap Moi did we experience such a serious situation. It didn't even happen during the Covid-19 pandemic, when the global economy took the worst beating of the 21st century."
At present, there are no recipes to fix such a pressing issue, because the lack of liquidity in the present heralds far worse problems, namely insolvency in the coming months in the face of interest on large debts incurred with China and the World Bank. This is why President William Ruto, who has taken it upon himself to resolve a situation that he assures was totally inherited from the previous administration, whose number two in the "control room" anyway, is spasmodically looking for funding in the form of partnerships and plans to put up for sale state-owned and jointly-owned companies, as well as universities and the national airline Kenya Airways.
Meanwhile, as we reported a few days ago, prices of everything are rising and the scarcity of foreign currency, particularly dollars, is also affecting the price of fuel and imported products. In the case of gasoline, there would be agreements with Arab countries on the horizon to be able to pay in shillings.