The government has disclosed plans to spend Ksh130 billion ($1 billion) for partial repayment of the Eurobond maturing in 2027.
According to a report by Bloomberg, the move is part of the government’s strategy to help the country get out of debt distress.
Kenya's National Treasury will utilise the recent Ksh156 billion World Bank loan allocation to offset the long-term debt three years before the maturity date.
“The planned buyback is aimed at smoothing the amortization profile as was done for the recent issuance which was smoothed over three years,” stated the World Bank report.
It will be the second time that the country is making Eurobond buyback this year after partially settling the Ksh310 billion ($2 billion) Eurobond maturing in June this year.
This will bring the total buybacks this year to Ksh326 billion ($2.5 billion) even as the government puts in place strategies to offset more debt.
This comes amidst President Ruto's call for concessional financing by accessing loans with lower interest rates and longer repayment tenors.
Kenya also plans to issue debt swaps and sustainability-linked bonds as part of managing its debt.
In February this year, the National Treasury announced Ksh233 billion ($1.5 billion) buyback of the Eurobond maturing in June this year.
Ruto while speaking during a press briefing in Nakuru County, remarked that the payment was made four months before maturity to alleviate the concerns of foreign investors.
“Yesterday marked a significant financial milestone for Kenya as we successfully settled the buy-back of a substantial part of the USD2 billion 2014 Eurobonds that were scheduled to mature on 24th June 2024,” the Head of State remarked.
“I can now confidently say, Kenya is no longer on the list of countries that run the risk of debt default,” he added.
