Economic Turmoil in Debt Distressed Kenya During Post Pandemic Years

Kenya went through a serious economic crisis from 2022 to 2024, which was defined by a sharp decline in the country's GDP and poor performance in many different areas of the economy. The nation's financial instability was made worse by the considerable government uncertainty and widespread corruption at this time. One of the main problems was the rising rate of unemployment and poverty, which was caused by both internal mismanagement and external shocks like the COVID-19 pandemic's repercussions and the chaos caused by the conflict in Ukraine. Kenya's economic problems stemmed from a high debt load, mostly from loans from China that were used to finance infrastructure projects. Although these loans were first viewed as engines of progress, they eventually became unsustainable, raising concerns about default and loss of sovereignty. Kenya urged the International Monetary Fund (IMF) to step in and try to stabilize the economy. But the support of the IMF came with strict austerity measures, such as substantial cuts to public spending. Social distress among the public was exacerbated by these actions, which resulted in a decline in social welfare services. The implementation of austerity measures, in conjunction with increases in income tax, excise taxes, and value-added tax (VAT), resulted in further financial strains for both individuals and corporations, especially small and medium-sized firms (SMEs). As a result, the economic situation got worse and many businesses closed, which resulted in a large loss of jobs. Years of progress in reducing poverty have been undone by the high rates of unemployment and poverty, with many Kenyans finding it difficult to pay for necessities in the face of skyrocketing inflation. The economic situation deteriorated due in large part to corruption, as public monies meant for relief and development were often embezzled. This weakened public confidence and impeded the government's ability to respond to the crisis effectively. This research paper has illustrated real economic challenge of Kenya in post pandemic period. Endeavour is made to clarify the root cause of the crisis, fallout of economic distress, social hardship, and actions taken to mitigate the disorder.