If the successor to Vision 2030 is to be more than a fresh list of things to borrow for, it has to begin where the last one failed, with the discipline that turns borrowed shillings into productive ones. Writes Cuba Houghton, a Kenyan economist and public finance practitioner.
As Kenya begins to imagine what comes after 2030, the temptation will be to debate the next set of flagship projects: which road, which port, which city. That is the wrong argument. The failure of Vision 2030 was never a shortage of ambition or projects. It was that we decided what to build without ever really deciding how to pay for it, or how to know whether it was working.
Kenya’s development blueprint, Vision 2030, aimed to transform it into a newly industrializing, middle-income country through, among other avenues, investment in infrastructure development and key public services such as Health and Education. According to the plan ‘investment in national infrastructure will be given the highest priority’, making infrastructure a foundational pillar and arguably the prevailing definition of development itself since.
This focus on building implicitly created an infrastructure deficit, setting Kenya on a path requiring large-scale and expensive projects such as the Nairobi-Thika Superhighway and the Standard Gauge Railway (SGR) from Nairobi to Mombasa. Building this kind of physical infrastructure often means undertaking very large, expensive and long-term projects. The justification offered is that these projects are expected to boost incomes, create jobs and promote long-term economic growth.
If what comes after Vision 2030 makes the same mistakes, Kenya will simply borrow, build, and bust again, and it will once more be the social pillar that pays for the economic one.
Faced with a long list of such projects, Kenya resolved to borrow aggressively, both locally and externally, to finance development. This model is neither new nor unique, as several other countries had by that time pursued debt-led development. In the 2000s, Ethiopia, Ghana and Nigeria are examples that, like Kenya, looked to commercial Eurobonds and Chinese loans to finance large infrastructure sectors. Further East, China itself had by then become the reference case for a state-led, debt-financed investment model.
The economic argument for borrowing is that it unlocks finance in a short period, allowing nations to invest in multiple large projects today and spread the cost of repayment into the future. If these investments are productive enough (return>cost) governments should comfortably repay the resulting public debt through higher tax collections enabled by the new economic activity. Borrowing also gives governments quick access to finance to respond to emerging crises, like the COVID-19 pandemic or an extreme weather shock.
The Cost of Debt-led Development
However, public debt also comes at a cost.
A fundamental weakness in Vision 2030 was that it set out ambitious, large-scale infrastructure targets without an accompanying, practical financing strategy to deliver them.
At the launch of Vision 2030 in 2008, Kenya’s debt stock was KSh 0.87 trillion. By the end of 2025, it had risen to KSh 12.30 trillion, a 1300%+ increase. This astronomical increase has gradually placed a strain on the national budget through increasing debt interest and principal payments, which now consume up to 70% of taxes collected annually.
Notably, these debt payments have historically risen both due to consistent borrowing to finance budget deficits and external shocks like those experienced in 2023 – which can increase the value of Kenya’s debt without additional borrowing.
As a result, the amount of room in the budget that Kenya has to spend on other priorities has shrunk as public debt has risen. A 2026 study covering roughly 30 years found that Kenya’s public debt has negatively affected social spending, with a 1% annual increase in its public-debt stock associated with a roughly 3% proportional decline in combined spending on health, education, and social protection.
In 2010, Kenya’s debt payments and education spending each represented about 30% of ordinary tax revenue. By 2023 the share allocated to debt payments was nearly three times the share allocated to education.
This growing burden of debt has been experienced by Kenyans through increased taxes and lower quality and quantity of public goods and services over time. Admittedly, this demand for higher taxation amid weak service delivery is the core tension that launched the historic June 2024 Gen-Z protests. In a bid to finance Vision 2030’s economic pillar, a young Kenya began to default on its social pillar.
Flying Development Blind
A fundamental weakness in Vision 2030 was that it set out ambitious, large-scale infrastructure targets without an accompanying, practical financing strategy to deliver them. The blueprint initially gestured at funding sources such as raising national savings to 30% of GDP, remittances, FDI and sovereign bonds, and promised ‘ring-fenced’ investment through its Medium Term Plans, but it offered no costed financing framework.
The planning process offered no guidance on sequencing borrowing against the state’s repayment capacity, and no structure of mechanisms to ensure that debt-financed investment became productive enough over time to service itself. Those decisions were left to successive Medium Term Plans, manifestos and annual budgets in the absence of a disciplined, government-wide returns-tested framework.
This created both technical and political challenges further down the road, where successive administrations expected to deliver on development ambitions were left to figure out how to finance them or suffer politically. According to a 2025 report on the progress of Vision 2030, budgetary constraints and inadequate capital financing were the frequent challenges faced for several flagship programmes and projects across sectors. This points to financing as the undoing of vision 2030, not necessarily its ambition.
The numbers show that post-2013, as cheap aid became lean, public debt came to prominence as a weapon of choice. As borrowing grew, a fiscal culture of kicking the responsibility for paying the debt bill down the road to the next government began, nearly pushing Kenya to the point of default in early 2024. Today, although public private partnerships have come to prominence, borrowing remains a large contributor to the public purse – financing nearly a quarter of the current budget through on-budget and off-budget borrowing.
Lessons for Post-2030
To be clear, this would all be fine if every shilling that Kenya borrowed was productive. But the numbers tell a different story.
On paper, Kenya has built the institutional machinery of public investment management that should make debt-financed infrastructure projects productive. In practice however, nearly half of more than a thousand government projects had stalled by 2024, KSh 304 billion of KSh 515 billion earmarked for flagship projects between 2019 and 2024 was unspent, and billions of shillings are still being paid in commitment fees on loans never spent.
As Kenya begins to imagine what comes after 2030, the temptation will be to debate the next set of flagship projects: which road, which port, which city. That is the wrong argument. The failure of Vision 2030 was never a shortage of ambition or projects. It was that we decided what to build without ever really deciding how to pay for it, or how to know whether it was working.
If the successor to Vision 2030 is to be more than a fresh list of things to borrow for, it has to begin where the last one failed, with the discipline that turns borrowed shillings into productive ones. Otherwise Kenya will simply borrow, build, and bust again, and it will once more be the social pillar that pays for the economic one.
