He did not respond to a request for comment on Tuesday but another lawmaker told Reuters the salaries were sent to bank accounts on Tuesday morning. Lawmakers had not received their March salary by April 7, a delay from the usual payment time of before March 26-30. Ndii attributed the delays to the liquidity challenges posed by the rising repayment of debts. Finance Minister Njuguna Ndung'u did not respond immediately to a request for comment. ($1 = 133.6000 Kenyan shillings) (Reporting by Duncan Miriri; Editing by Christina Fincher)
Reuters Messaging: duncan.miriri.thomsonreuters.com@reuters.net)) By Duncan Miriri
NAIROBI, April 11 (Reuters) - Kenya will not default on
its debt repayment obligations, the president's chief economic
adviser said, as the government delayed payment of civil service
salaries due to a cash squeeze caused by massive interest
payments.
President William Ruto won a hotly contested election last
August on a platform of planning to lift millions out of
poverty, but he is facing challenges from the high cost of
living and growing debt repayments.
The debt burden, compounded by a weakening local currency
and international market turmoil precipitated by a banking
crisis, have caused some market participants to speculate that
Kenya could soon default like Zambia and Ghana.
Nairobi has no plans to go down that route, said David Ndii,
the president's adviser.
"We are not insolvent. We can finance repayments. It is a
significant sacrifice but we are actually able to pay," Ndii
told Citizen TV late on Monday.
He said default was a "very bad idea" since it would force
the government to "spend the next three to four years in very
protracted debt restructuring negotiations."
Annual interest payments on domestic debt alone have surged
to 680 billion shillings ($5.09 billion) this year from 180
billion shillings nearly a decade ago when the debt binge
started, Ndii said, heaping pressure on the government's cash
flow.
"That unfortunately is the lay of the land for quite a
while," he said.
The government was failing in one of its most basic
obligations by failing to pay its workers, said Opiyo Wandayi,
the leader of the opposition in the national assembly.
"Civil servants and MPs have gone to Easter without
salaries," he said in a statement issued during the weekend.
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