President Ruto's initiative to repay a portion of the country's Eurobond, which matures in June this year, appears to have set a new precedent for other African nations.
Two weeks ago, Kenya conducted a buyback of Ksh218 billion (USD1.5 billion) from its Ksh310 billion (USD2 billion) Eurobond, characterizing the move as part of its comprehensive debt management strategy.
Following suit, Benin has taken steps to initiate a buyback of its maturing Eurobonds with amortisation periods of 2026 and 2032.
These bonds encompass the outstanding amount of Ksh28 billion (€176.36 million) due in 2026 and Ksh111 billion (€700 million) due in 2032.
According to the West African nation, the decision is part of a proactive debt management strategy.
"The Republic is making the offers as part of its proactive debt management strategy. The Republic is offering to purchase for cash, subject to the conditions outlined in the tender offer memorandum, any of its outstanding 2026 Notes," read part of a state by the West African country.
Benin's buyback program began on February 28, with tender offers set to expire on March 6, and settlement anticipated for March 12.
Early Eurobond issuance holds significance for a country as it grants access to external financing, facilitating funding for various government projects.
In a related development, on February 21, the Kenyan government disclosed that it had made a payment of USD1.5 billion (equivalent to Ksh218 billion) as part of a USD2 billion Eurobond loan.
President William Ruto, speaking to the press in Naivasha, emphasized that the payment was made four months ahead of maturity to alleviate anxiety among 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 June 2024,” Ruto remarked.
“I can now confidently say, Kenya is no longer on the list of countries that run the risk of debt default,” he added.
