Examining the legal challenges in debt financing: implications on economic development in Kenya

Abstract

This study will demonstrate the link between legal issues in debt financing, their implications for Kenya's economic growth as well as its effect on the debt that the country is in. Kenya has been and remains dependent extensively on debt financing to drive its economic growth and development goals. However, the efficacy and sustainability of this method are hampered by several legal obstacles, including concerns about transparency, accountability, and debt management techniques. The study intends to investigate how inadequate debt management techniques, lack of transparency, and accountability in borrowing procedures lead to unsustainable debt build up and impeding economic progress. An analysis of how the effects of excessive borrowing stifles consumer spending, investment, and resource allocation, perpetuating social gaps and preventing inclusive growth due to the increase of the cost of living which is one of its effects. The end goal of this research piece is to inform policymakers, practitioners, and stakeholders about the urgent need for debt management and fiscal policy reforms by providing critical insights into the nexus between legal challenges in debt financing and economic development in Kenya. This study is tantamount as it will contribute to evidence-based policymaking for achieving fiscal sustainability with transparency and accountability, risk management with regard to debt and the impact this has had on economic development prospects for Kenya by advocating some sustainable solutions that will have better prospects in the long run. Key words: Economic growth, debt financing and debt management.