Kenya admits cash crunch as workers Threaten Strike
The Kenyan government has admitted that it is experiencing a cash shortage, which has caused thousands of public employees’ salaries to be delayed.
It claims it was forced to make difficult choices between paying salaries or servicing millions of dollars in external debt due this month.
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According to the report, the treasury has also failed to transfer funds to counties, which oversee public services such as health and education.
Ministry, agency, and county government employees have been the most negatively affected by the March pay delays.
Minister of Finance Njuguna Ndung’u stated that the government was facing financial constraints due to underperforming revenues and restricted access to credit.
Nonetheless, two unions representing federal and county government workers have issued notices of their intent to boycott work.
According to a report, Vice President Rigathi Gachagua attributes the crisis to the previous government, which he accuses of borrowing heavily while in power and plundering the treasury before leaving office last year. However, he has not provided any proof of the allegations.
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While Presidential economic adviser David Ndii stated that the delayed paychecks did not constitute a crisis, he referred to the situation as a “operational liquidity crunch.”
Mr. Ndii stated in an interview that the government was anticipating $500 million from a syndicated loan and that civil servants’ salaries would be paid by the end of the following week.
In the meantime, Kenya’s public debt has increased to 65% of revenue. The country requires more than $420 million per month to pay civil servant salaries and pensions.
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