Israel to fund part of Kenya’s military modernisation with Sh3.4 billion loan

Kenya is set to receive a Sh3.4 billion loan from Israel to help finance the purchase of a modern missile defence system as part of wider efforts to boost national security in the face of rising terror threats.

The funds will be channelled directly to the Ministry of Defence in the 2025/2026 financial year, according to budget documents presented in Parliament.

This development comes nearly a year after the Treasury disclosed plans to seek a Sh1 billion loan from Israel for the same purpose.

The latest funding will support the acquisition of the Spyder Defence System, a high-tech surface-to-air missile system capable of intercepting aircraft, drones, helicopters, and guided weapons.

The loan agreement signals an escalation in Kenya’s bid to modernise its military capabilities amid growing security concerns in the region. National Intelligence Service director-general Noordin Haji recently warned of intensifying threats posed by extremist groups operating within and beyond East Africa.

“As part of this expansion, ISIS and Al-Shabaab have been collaborating with the Houthis, gaining access to advanced weaponry and sophisticated training. The spillover effects are now being felt in Africa, making the continent an emerging epicentre of terrorism,” Haji said.

Kenya has long faced threats from Al-Shabaab, and security experts have urged the government to invest more in modern surveillance and defence systems to detect and neutralise attacks before they occur.

Last year, the Ministry of Defence requested an additional Sh3 billion from the Exchequer for the purchase of the Spyder system, indicating the urgency with which the government views the matter.

The system, developed to protect against aerial threats, is part of a broader strategy to equip the Kenya Defence Forces (KDF) with modern tools to secure the country’s borders and contribute effectively to regional peace efforts.

In recent years, Kenya has increased its military spending, with data showing that expenditure on defence equipment rose to Sh166.8 billion last year from Sh147.37 billion in 2023.

The US and Turkey remain Kenya’s key suppliers of military hardware, including helicopters, armoured vehicles and drones.

Beyond defending against terror threats, the modernisation plan is also intended to align the KDF with international standards required for participation in United Nations peacekeeping missions, which often come with financial support.

Two years ago, the government announced it would spend Sh7 billion annually for five years to revamp the country’s security agencies and better equip them to handle foreign threats.

The loan from Israel is expected to complement that effort by enhancing Kenya’s air defence systems.

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