Kiharu Member of Parliament, Ndindi Nyoro, has launched an attack on the government over the Ksh44.8 billion infrastructure bond issued by Linzi Finco to fund the construction of the Talanta Sports Stadium.
Speaking on Wednesday, July 23, Nyoro warned that Kenyans will pay back over Ksh100 billion in interest alone for the bond by the time it matures.
“Since the government debt is already overstretched, the government is coming up with this kind of facilities so that it does not seem like our debt is growing, whereas we are having another secret book of debt. One secret book was the fuel levy; the second is this Talanta bond under the auspices of the Sports Fund,” said Nyoro.
The Kiharu lawmaker pointed out that the loan attracts an interest rate of 15.04 percent semiannually, translating to approximately Ksh3.4 billion, which will be paid from the Sports Fund every six months.
“The interest rate is 15.04 per cent. It may seem like just figures, but they affect every Kenyan because it means the government will be paying around Ksh3.4 billion from the Sports Fund every six months. At the maturity of the bond in the next 15 years, Kenyans will have paid over Ksh100 billion for a loan of Ksh44.8 billion,” he stated.
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The former Chairperson of the Budget and Appropriations Committee questioned why the government was in a rush to secure a loan that, upon maturity, would cost more than double the principal amount in interest alone.
“From where we see it, it is a very reckless manner of running the finances of a country because we are now mortgaging our income streams. Experienced officers in the National Treasury do not even support it,” Nyoro added.
On Wednesday, President William Ruto presided over the listing of the Linzi 003 Infrastructure bond at the Nairobi Security Exchange (NSE).
The president hailed the listing as a milestone in Kenya’s efforts to leverage capital markets for national development.
“The successful origination, structuring, and listing of the Linzi 003 Infrastructure Asset-Backed Security, the first of its kind in Kenya, raising over Ksh44 billion, is a landmark achievement. It affirms our confidence in market-based financing and demonstrates how we can sustainably fund large-scale infrastructure through our capital markets,” said Ruto.
The funds will be utilized to support the construction of the 60,000-seater Talanta Sports City Stadium.
Once completed, the stadium is slated to be used for the 2027 Africa Cup of Nations Championships, which Kenya, Uganda, and Tanzania will co-host.
