Kenya's debt repayments to China declined significantly in the 2025/26 financial year, easing pressure on the country's external debt obligations after years of heavy servicing.
National Treasury data shows repayments fell to Sh107.74 billion, down from Sh129.35 billion in FY2024/25 and well below the record Sh152.69 billion paid in FY2023/24.
The decline reflects the government's gradual progress in meeting repayment obligations on major Chinese-funded infrastructure loans, including those used to finance roads and the Standard Gauge Railway.
Principal repayments dropped to about Sh68 billion in FY2025/26 from nearly Sh98 billion at the FY2023/24 peak, while interest payments also fell to around Sh27 billion from approximately Sh50 billion over the same period.
Despite the reduction, China remains one of Kenya's largest bilateral creditors, meaning debt servicing will continue to consume a significant share of public resources
The easing repayments, however, provide some fiscal breathing room as the government pursues debt sustainability and creates space for spending on key development priorities.
