We can Manage Kenya's Debt Burden by sustaining the reduction of the cost of buying the dollar. By Billy Mijungu Kenya is drowning in debt with dollar denominated external debt well over Ksh 5 trillion and domestic debt exceeding Ksh 6 trillion the economy faces an unsustainable financial burden. The consequences are dire limited access to affordable credit for ordinary citizens stagnation in private sector growth and a government increasingly reliant on high interest borrowing from local banks. The current debt trajectory must change and change fast. The basics of any thriving economy demand lower interest rates and the availability of local resources to facilitate wealth creation. However with Ksh 6 trillion borrowed by the government domestically commercial banks have little incentive to lend to individuals and businesses. Why would they take on the risk of lending to struggling enterprises when they can provide secure loans to the government at lucrative interest rates This situation creates a credit crunch choking off opportunities for economic expansion at the grassroots level. The government must actively shift away from relying on local banks for financing. Instead it should seek alternative revenue sources such as infrastructure bonds diaspora bonds and well structured public private partnerships. Furthermore privatization remains a viable strategy. Selling off underperforming state owned enterprises could inject much needed liquidity into the economy while reducing the government's debt appetite. A surprising yet effective development has been the recent appreciation of the Kenya shilling against the US dollar. Just months ago the exchange rate stood at Ksh 165 to the dollar today it has strengthened to Ksh 129. This shift alone has slashed nearly Ksh 1 trillion from external debt obligations. If such an appreciation can yield such massive relief why stop at Ksh 129 to the dollar The government should aim for an even stronger shilling perhaps below Ksh 50 to the dollar. While this might sound simplistic currency appreciation directly reduces the shilling equivalent of external debt and eases the repayment burden. To sustain and enhance this strategy the government must adopt policies that boost forex reserves encourage exports and limit unnecessary imports. Additionally ensuring a stable business environment that attracts foreign direct investment FDI will further strengthen the shilling. The forex market plays a crucial role in economic stability. Addressing inefficiencies curbing speculative trading that weakens the shilling and ensuring a predictable exchange rate policy will provide a much needed economic boost. A stable exchange rate enhances investor confidence stabilizes inflation and ensures that Kenya’s debt burden remains manageable. Kenya's current debt burden is unsustainable but it is not irreversible. The government must take decisive action to reduce reliance on expensive domestic borrowing leverage forex market efficiencies and pursue strategic debt management policies. Without urgent reform the country risks deeper economic turmoil. Now is the time for bold and pragmatic economic leadership Facebook X Instagram TikTok LinkedIn @BillyMijungu #forward #tusongembele