FILE PHOTO | NMG 

The Treasury will find it difficult raising 2020/21 domestic financing that is more than a quarter larger than in the ending fiscal year, meaning high chances of mid-term public spending cuts.

Analysts at Kestrel Capital say with the Treasury having mobilised Sh391 billion for this fiscal year, it will be a gruelling task to raise Sh493 billion proposed in the 2020/21 budget — that is an extra Sh102 billion or 26 percent.

The domestic target of Sh493 billion for FY20/21 was thus unrealistic,” said Alexander Muiruri in an analysis of the budget for the next State fiscal year.

Besides the domestic financing, the Treasury plans to bridge the fiscal deficit through money from foreign entities.

That is to say, the trend of adjustments in deficit financing in the budget in the fiscal year is likely to be maintained.