unmanageable-debtThere is a limit to the amount of free spending that a country’s treasury can incur before the available funds run out, and in the case of Kenya the spending limit seems to be approaching. Just over a year ago the country began an expensive military intervention in Somalia, and then negotiated a deal whereby Kenyan forces would join up with Amisom forces and the United Nations would foot the bill.

Now it seems that Amisom has asked for the receipts to verify the $209 million expenses claim that Kenya has filed. This is rather awkward for Kenya, as it has already spent the expected $209 million in funding the first stage of its forthcoming elections. No provision has been made for funding run-off elections, should they prove necessary, and the country’s ambitious budget for the current year is already more than $1.5 billion in arrears.

The government’s taxes and revenues for the current financial year are $500 million behind budget. Recent salary rises for teachers, health workers and police have increased costs by $350 million. Other unbudgeted expenditures including security operations and implementation of the new Constitution stand at around $800 million. Whoever wins the upcoming elections will be faced with significant fiscal challenges upon taking up office.

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