Treasury Secures Sh193.8bn for Eurobond Redemption


The government has successfully raised $1.5 billion (equivalent to Sh193.8 billion) in the international capital markets, utilizing a portion of these funds to redeem $1 billion of its Eurobond maturing in 2028 ahead of its scheduled date.

  Chris Kiptoo, the Treasury Principal Secretary, indicated that the issuance included a 7-year tranche at an interest rate of 7.875 percent and a 12-year tranche at 8.8 percent, resulting in an overall cost of 8.7 percent, which is nearly one percentage point lower than earlier this year. Kiptoo remarked, "This marks the third such transaction since 2024, demonstrating the Government’s steadfast commitment to prudent debt management, timely loan repayments, and safeguarding Kenyans from unexpected repayment shocks." The majority of subscriptions were sourced from institutional investors in the United States and the United Kingdom, which the Treasury interprets as a sign of renewed confidence in Kenya’s debt management practices. By refinancing at reduced rates and extending maturities, the government aims to alleviate the burden on taxpayers, create fiscal space for infrastructure, healthcare, and education, and ensure smoother future repayment schedules. This initiative is part of Kenya’s comprehensive liability-management strategy, which also encompasses buybacks and the issuance of new notes. Nevertheless, analysts warn that long-term sustainability will still hinge on robust economic growth, responsible fiscal policies, and ongoing access to concessional financing. The successful bond sale coincides with the IMF's review discussions in Nairobi, which may enhance the country’s negotiating position.

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