I have always wondered why people fear national debt... if someone is unwise enough to give you lots of money bila conditions or collateral - the joke is on him.

Brazil is the country that might have become another Japan. Instead, it is flat broke, with a broken spirit and an empty treasury.

The Brazilian ''miracle'' - the spurt of growth from the late 1960's to the late 1970's - became the economist's model of the way to manage expansion from agrarian stagnation to the newly industrialized stage.

Now, however, Brazil is in its third year of recession, and the country that once was the world banking system's ideal borrower pleads for loans just to pay the interest on its debts.

How Brazil fell to a position where it is known best today for the weight of its $92 billion foreign debt, larger than that of any other country, is a matter that absorbs all those who have a stake in the country - Brazilians themselves and the industrial world, which relies for much of its own prosperity on the health of developing countries such as Brazil.

Leading Brazilians both inside and outside the Government cite the effects of the sharp rise in oil prices during the 1970's on an economy that had been building its future on imported oil. They blame Western banks for heaping an insupportable burden of loans on the country. And they blame the United States for incurring budget deficits of $200 billion a year that have forced up world interest rates and hence affected the ability of Brazil to make interest payments.

Ultimately, however, they blame Brazil's technocrats, the people who took the bankers' money.

'Pharaonic Projects' Cited

The technocrats' errors, in the view of many Brazilians, involved Pharaonic projects, many of which were conceived to protect Brazil from future oil-price shocks.

For example, until the current economy forced them to postpone some, the Government-owned power utilities were building enough plants - hydroelectric, nuclear and coal - to produce more power than Brazil is expected to need well beyond the year 2000.

In addition, a multibillion-dollar railroad, with many costly bridges and tunnels, is being built alongside a railroad that, critics contend, might have been rehabilitated at much lower cost.

Its not how much debt that a country has that matters (which is what our jonalists focus on) but the ratio between the interest payments and income. If the income of GOK increases, the interest payments will shrink as a percentage of your income.

If the current debt to GDP ratio is at 51% then i dont see what the cause of alarm is esp given that these projects are expected to grow the income of the country. What we should not be doing is to borrow to pay salaries or spend on unnecessary pleasures.

Its not how much debt that a country has that matters (which is what our jonalists focus on) but the ratio between the interest payments and income. If the income of GOK increases, the interest payments will shrink as a percentage of your income.

If the current debt to GDP ratio is at 51% then i dont see what the cause of alarm is esp given that these projects are expected to grow the income of the country. What we should not be doing is to borrow to pay salaries or spend on unnecessary pleasures.

Infrastructure projects such as roads, rail, electricity generation, airports ya ukweli, etc.

Problem with Kenya is that they are usually overpriced, their construction are undertaken inefficiently and most of all corruption and fraud involved. At end of the day, they became very expensive to the nation.