Kenya looks to refinance $2bn Eurobonds as interest rates ease
Kenya may return to the international bond market to refinance $2bn of Eurobonds maturing in June 2024, aided by the easing of interest rates in the US, according to Standard Chartered Bank Kenya.
The bank’s Africa strategist, Eva Wanjiku-Otieno, said that “market conditions would have improved” if the Federal Reserve begins to cut interest rates, which would increase “the probability of Kenya being able to refinance its upcoming maturity,” rather than having to tap its foreign-exchange reserves.
Lower US borrowing costs will help frontier markets such as Kenya to resume selling overseas bonds after being locked out of capital markets for over a year.
President William Ruto’s efforts to reduce subsidies and control debt may also help to attract investors.
Despite Kenya’s high risk of debt distress, as categorised by the International Monetary Fund, the country had public liabilities of 8.9tn shillings ($72bn) as of November, according to central bank data.
