Kenya’s budget deficit is projected to increase to 5.9 per cent of gross domestic product (GDP) in the 2027/28 financial year, up from 5.5 per cent in the preceding financial year, according to the National Treasury.
The projected increase signals a higher financing gap as the government prepares its spending plans for the financial year beginning July 2027.
Treasury projections indicate that domestic borrowing will decline to KSh929.1 billion in 2027/28, compared with KSh1.04 trillion in 2026/27.
Over the same period, external financing is expected to rise to KSh423.8 billion from KSh247.2 billion, pointing to an increased reliance on foreign funding to support government expenditure.
The 2027/28 Budget is expected to be presented to Parliament ahead of the August 2027 General Election, with the government preparing its fiscal plans earlier than usual.
The projected deficit will be a key indicator of the government’s borrowing requirements and its efforts to balance expenditure with available revenue.
The Treasury’s estimates will inform discussions on public spending, debt management and the financing of government programmes in the coming financial year.
