Kenya is turning to foreign governments for funding as it seeks to drive its ambitious Ksh4.2 trillion budget for the 2025/26 financial year.
According to the latest budget estimates from the National Treasury, President William Ruto’s administration plans to borrow over Ksh57.4 billion from 13 countries through bilateral loans and grants, with the money earmarked for critical infrastructure and service delivery projects.
The targeted sectors include energy, transport, health, water, education, and digital infrastructure, all central to Ruto’s economic transformation agenda. The borrowing plan is also part of a broader strategy to reduce dependence on costly domestic loans by securing more affordable foreign financing.
Saudi Arabia, France, and Japan Top List of Bilateral Lenders
Saudi Arabia will contribute the largest bilateral loan package, offering Ksh91.45 billion to support Kenya’s fuel program. France has pledged Ksh45.82 billion for infrastructure initiatives, while Japan will inject Ksh33.69 billion, continuing its long-term partnership with Kenya on major transport and energy projects.
China, a longstanding financier of infrastructure development in the country—including the Standard Gauge Railway (SGR)—comes in fourth, with Ksh9.38 billion in loans.
Below is a full list of the 13 lending countries and their contributions:
| Country | Loan Amount (Ksh) |
|---|---|
| Finland | 900 million |
| Belgium | 200 million |
| Italy | 1.01 billion |
| Spain | 3.16 billion |
| Germany (KfW) | 10.66 billion |
| France (AFD) | 15.35 billion |
| Kuwait | 550 million |
| Saudi Arabia | 1.32 billion (plus separate Ksh91.45B fuel loan) |
| Japan | 6.56 billion |
| South Korea | 4.05 billion |
| China | 9.39 billion |
| Israel | 3.40 billion |
| Hungary | 900 million |
Total loans: Ksh57.43 billion
Additional fuel loan from Saudi Arabia: Ksh91.45 billion
U.S. and Germany Lead in Foreign Grants
When it comes to grants, the United States stands out as Kenya’s most generous donor, pledging Ksh20.87 billion to fund programs in governance, healthcare, and social development. Germany, through both KfW and GIZ, has committed a mix of grants and technical assistance totaling over Ksh3.73 billion.
Other countries contributing through grants include Denmark, Sweden, Finland, Belgium, Italy, France, and Japan.
| Country | Grant Amount (Ksh) |
|---|---|
| Denmark | 1.21 billion |
| Sweden | 340 million |
| Finland | 500 million |
| Belgium | 10 million |
| Italy | 281 million |
| Germany (KfW + GIZ) | 3.73 billion |
| France (AFD) | 1.36 billion |
| Japan | 907 million |
| USA (USAID) | 20.87 billion |
Total grants: Ksh8.62 billion
World Bank and IMF Support Still Vital
In addition to bilateral funding, Kenya will continue to rely on multilateral lenders like the World Bank and the International Monetary Fund (IMF) to meet its financing needs. These institutions are expected to provide significant budgetary support and policy-based loans as the country navigates economic reforms and debt management.
