Chinese hackers attacked Kenyan ministries and state agencies between 2019 and 2020 to assess debt owed to Beijing, a Reuters investigation shows.
Reuters reported on Wednesday that years-long cyberattacks started in 2019 when the Chinese started closing credit taps to Kenya as debt strains started showing.
The security breach started with a spearphishing attack after a State employee downloaded an infected document unknowingly, Reuters said.
The attacks targeted the Presidency, eight key ministries including foreign and finance ministries and State departments.
Kenya owed China $6.31 billion last March, the smallest volume since $6.01 billion in March 2019 after peaking in June 2021 at $7.06 billion.
The drop is in line with Beijing’s cautious approach to lending to Kenya and Africa in the post-Covid era amid warnings that key economies in the continent were facing a multitude of debt tripwires in the wake of a protracted global economic turmoil and could default on payments.
That slow-down investment in Africa’s infrastructural projects came after a few countries like Angola and Ethiopia struggled to honour obligations, while Zambia defaulted.
This comes at a time President William Ruto has made it clear that his administration will cut down on expensive foreign borrowing, including rich countries like China.
The bulk of China’s loans to Kenya were channelled through Exim Bank, which in May 2014 bagged the mega deal to fund as much as 90 percent of the $3.6 billion (about Sh494 billion under the prevailing exchange rate), 485-kilometre Mombasa-Nairobi SGR line.
The SGR deal saw Beijing overtake Tokyo as Kenya’s largest bilateral lender.
The terms of Beijing’s loan deals with developing countries are usually secretive and require borrowing nations like Kenya to prioritise repayment to Chinese state-owned banks ahead of other creditors, according to a dataset compiled by AidData — a US research lab at the College of William & Mary.
Kenya’s bilateral debt repayments towards China-funded infrastructure projects have grown by nearly half to a new record of Sh107.42 billion this financial year on the back of increased clearance of principal sums after the grace period lapsed.
The expenditure data published by Treasury Cabinet Secretary Njuguna Ndung’u shows the amount repaid to Chinese lenders was 46.19 percent more than Sh73.48 billion in the previous financial year.
This comes after the repayment moratorium ended four years ago.
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