Operations came to a sudden halt this week at Kakamega hospital near Kenya's Lake Victoria coast. The reason? The water was cut off following a failure to pay the bill.

For doctors and nurses in Kenya's struggling healthcare system, it was another symptom of the collapse of an economy burdened by huge foreign debts.

Of little comfort to the patients is the fact that Kenya spends more on servicing foreign debt than it does on running its hospitals. On Thursday, President Clinton announced a list of 36 countries entitled to American debt relief. Kenya was not among them.

Kenya owes $4.4 billion and each year spends 16 per cent of state revenue on repayments. This compares to 20 per cent spent on social services, including health, primary education, water and sanitation. With a total government budget last year of $2.2 billion, it will take decades to repay the debt.

Activists argue that paying foreign debts is wrong when most of Kenya's 30 million citizens are mired in deep poverty. According to World Bank development indicators, the gap between Kenya's rich few and its poor majority is second only to Brazil in its inequality.

The country's roads are collapsing following storms in 1997. The highway between Nairobi and the port of Mombasa has been severely damaged and in one stretch exists only as a rutted dirt road.

With investment in infrastructure almost non-existent, the delivery of basic services has suffered. The whole country is in the grip of electricity rationing with five-hour blackouts at least three times a week. The cuts were announced a month after the state power company raised charges by up to 25 per cent.

The only booming markets in Kenya are those dealing in second-hand clothes. At every traffic light in Nairobi drivers are assailed by hawkers, selling unlikely goods from calculators to clocks, who fight for attention with throngs of street children and crippled beggars.

In the capital's sprawling slums, there is often no running water, forcing residents to wash and drink from streams that also act as sewers. Coupled with an economic crisis that has caused high unemployment, Kenyans are desperate for any job, no matter how badly paid.

Without radical debt relief, things are likely to get worse for Kenyans. No economic recovery is seen until at least 2001 and the scourge of AIDS is sweeping the country. Latest figures suggest Kenyan life expectancy will drop from 65 years to 42 by 2010 and AIDS will create more than 1.5 million new orphans by 2005. It is unlikely Kenya's cash-starved healthcare sector will be able to cope unless it gets a huge injection of funds.

Opponents of debt relief point out that many of Kenya's problems are to some degree self-inflicted. Corruption and inefficiency are rife and government officials have long regarded the public coffers as theirs for the taking.

Government contracts are often given to friends of politicians, who skim off a percentage, resulting in shoddy work that collapses in a few years.

But Kenya has at least embarked on a process of reform. The indefatigable Richard Leakey has been appointed head of the civil service with a brief to stamp out corruption. He has already slashed the number of government ministries from 27 to 15 and sacked the heads of four state-run industries, including the head of Mombasa Port.

For many Kenyans, from economists to the man-in-the-street, the government is at last doing the right thing and should be rewarded by the international community, not burdened further by crippling debt.