The government has secured USD1.5 billion (Ksh193.8 billion) from international investors, enabling it to pay off part of the 2028 Eurobond ahead of schedule in a move aimed at easing future repayment pressures.
Treasury Principal Secretary Chris Kiptoo confirmed on Friday that the funds were obtained at a lower cost compared to earlier in the year, giving the country more flexibility in managing its debt obligations.
Out of the total amount raised, USD1 billion (Ksh129.24 billion) was immediately used to settle part of the Eurobond.
Also Read
“The Government is pleased to announce that it has successfully raised USD1.5 billion (Ksh193.8 billion) from international investors and, at the same time, paid off USD1 billion of the 2028 Eurobond ahead of schedule,” Kiptoo said in a statement.
According to the Treasury, the deal was structured into two tranches: a seven-year loan at 7.875 per cent interest and a twelve-year loan at 8.8 per cent.
This translated into an effective interest rate of 8.7 per cent—one percentage point lower than what Kenya would have paid earlier in the year.
Kiptoo noted that this was the third such transaction since 2024, underscoring the government’s efforts to manage public debt more prudently.
“By securing this deal, the Government has also smoothed and lengthened loan repayments, giving Kenya more breathing space in managing its finances,” he added.
The response from investors was strong, with offers exceeding USD7.5 billion (Ksh969.3 billion), five times the amount the government sought.
Most of the interest came from international fund managers in the United States and the United Kingdom, which Treasury said reflected renewed global confidence in Kenya’s economy.
Officials stated that the successful transaction would ease pressure on taxpayers, reduce the overall cost of borrowing, and help stabilize the economy while freeing up resources for development priorities such as roads, healthcare, and education.
The loan is expected to provide immediate relief to the budget and ensure greater predictability in servicing Kenya’s rising public debt, which has been a persistent concern for the country’s economic managers.