NAIROBI (Reuters) – Kenya expects to have a slightly narrower budget deficit and a modest increase in overall spending in its 2025/26 (July-June) fiscal year compared with the year that ends in June, the finance ministry said on Friday.
The deficit is projected to stand at 4.3% of gross domestic product (GDP) in 2025/26, down from 4.9% of GDP in 2024/25, according to the ministry’s Budget Policy Statement for February.
Overall spending is set to increase to 4.34 trillion shillings ($34 billion) in 2025/26 from 3.95 trillion shillings in the year ending in June, the ministry said.
The government plans to finance the deficit with net external financing of 146.8 billion shillings and net domestic financing of 684.2 billion shillings, the ministry said.
President William Ruto was forced to scrap tax increases worth more than 346 billion shillings ($2.7 billion) in June in the face of youth-led demonstrations that created the biggest crisis of his presidency.
($1 = 129.1000 Kenyan shillings)
(Reporting by George Obulutsa; Editing by Bate Felix)
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