Kenya has embarked on a hunt for another Eurobond valued at Kshs250 billion.
Treasury Cabinet Secretary Henry Rotich has reportedly sent out proposal seeking advice from international banks over the loan expected before the end of the current financial year.
Confirming reception, local banks linked with international lenders received the letters from the Treasury.
“We have received the RFP documents as we study the market but they do not set the rates or the tenors for the Eurobond. The minimum we expect the Treasury to raise is Ksh150 billion,” a source told Business Daily.
The banks further revealed that the state is likely to prefer this kind of loan since it is cheaper compared to the syndicated type it borrowed last time.
The loan is, reportedly, expected to partly repay the Kshs150 billion Eurobond while the rest finances the national budget.
The current syndicated Eurobond loan comprises of Kshs75 billion that matures this March 2019 while the rest will be due by end of June 2019.
This comes at a time when the country’s public debt has ballooned surpassing the Ksh5 trillion mark.
Analyst have expressed fears over the debt’s sustainability explaining that it exceeds half of the Gross Domestic Product (GDP) - the globally accepted threshold.
Kenya borrowed Kshs50 billion from international investors with a maturity of five years and an additional Kshs151 billion with a maturity of 10 years in 2014.
