Kenyan government is reportedly in talks with the International Monetary Fund for a credit facility to cushion its plan to issue a Kshs250 Billion bond.
According to a report by Reuters, the state engaged with the international lender after a previous one valued at Kshs 99 Billion expired.
The arrangement, which expired in September of 2018, was not renewed after the state failed to meet the conditions necessary for its renewal including the repeal of a cap on commercial lending.
“I can just confirm that discussions on a new programme are ongoing,” stated IMF's representative Jan Mikkelsen.
Analysts explained that the bond the state planned to issue would perform much better when the standby credit facility is secured.
In October 2018, reports hit headlines that the state was planning on floating another eurobond valued at Kshs 250 Billion with an aim of sealing the budget deficit.
According to Treasury PS Kamau Thugge at the time, the bond was aimed at raising Kshs 37 billion in syndicated loans.
In 2014, the country first floated the first Eurobond valued at Kshs 280 Billion in two tranches, one for five years and the other for 10 years.
The bond is nearly maturing with the first batch of Kshs 97.71 Billion expected to be paid by June this year.
Details of how the eurobond was spent, however, remain scany with the Treasury claiming that they spent it on infrastructural project countrywide while former Prime Minister Raila Odinga insisted that the money was mis-appropriated.
