Mbadi blames unfair ratings for rising loan costs
Business
By
Joackim Bwana
| Oct 07, 2025
National Treasury CS John Mbadi during the launch of Homa Bay County Press Club in Homa Bay Town, on October 5, 2025. [James Omoro, Standard]
National Treasury Cabinet Secretary John Mbadi has said that unfair and ill-informed credit ratings by foreign agencies have driven up Kenya’s borrowing costs.
Speaking during a credit rating workshop in Mombasa, Mbadi stressed that effective engagement with rating agencies requires transparency, consistent communication, and strong institutional coordination. The forum brought together the United Nations Development Programme (UNDP), the Government of Japan, AfriCatalyst, the African Peer Review Mechanism (APRM), and representatives of global credit rating agencies.
“Rating defence requires a well-prepared narrative that acknowledges risks while outlining actionable responses and demonstrating reforms, particularly when seeking positive rating adjustments,” Mbadi said.
READ MORE
KMPDU slams governors over remarks on Kiambu infant deaths
IG Kanja orders investigation into CHAN allowance misuse saga
Music mogul Sean 'Diddy' Combs sentenced to more than four years in prison
How 14 family members died in trip to visit sick aunt
Why Kenya's next medal should be in geothermal power sector
How Treasury's Sh864m debt is crippling media houses
Why students are burning schools, weeks to closure
Your phone, website could be shut down under new Cybercrime Bill
He noted that the UNDP pioneered the Credit Rating Initiative in Africa in 2005, enabling at least 18 countries to secure their first sovereign ratings. Kenya, identified as a focus country for 2025, has already taken part in specialised engagements in Addis Ababa and Cape Town.
Mbadi said the country’s recent credit rating upgrade highlights the benefits of fairer assessments, which help lower borrowing costs by improving investor confidence. Kenya will now establish a fully resourced Credit Rating Committee to coordinate and domesticate the rating agenda, ensuring it aligns with national priorities. Mbadi added that lower debt servicing costs would free resources for infrastructure, agriculture, and climate resilience.
He attributed the rating upgrade partly to reforms under the 2025 Finance Act, which enhanced tax compliance and fiscal credibility. Kenya’s shift to lower-middle-income status, however, means it no longer qualifies for highly concessional loans available to low-income nations.