Sharp Daily
No Result
View All Result
Friday, August 8, 2025
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
Sharp Daily
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
No Result
View All Result
Sharp Daily
No Result
View All Result
Home News

High Eurobond Yield Piles Pressure on Kenya Debt Servicing

Dennis Otsieno by Dennis Otsieno
April 4, 2023
in News
Reading Time: 2 mins read
The National Treasury

[Photo/Courtesy]

Kenya’s debt is projected to hit the Kshs 9.4 trillion mark at the end of June this year, according to the National Treasury.  As at December 2022, the government owed Kshs 4.7 trillion in external debt and Kshs 4.5 trillion in domestic debt.

The overall debt stock moved upwards in 2021 and 2022, largely because of new multilateral borrowing, but remained stable at 34.5 percent of GDP.

With this in mind, Kenya stares at a tough economic test ahead in debt servicing that could cause debt distress. This is backed up by the high bond yields that are still above rates registered at the beginning of 2022, between six and nine percent, and during the issuance of the papers.

Read: Ruto Assures Investors of a Predictable Tax Regime

RELATEDPOSTS

Real yields vs. nominal yields on Kenya’s government bonds

May 21, 2025

Kenya’s debt dilemma

May 2, 2025

The country could face debt servicing constraints if it fails to redeem the ten-year Eurobond due in June 2024.

Latest data by the Central Bank of Kenya put the 2024 Eurobond yield at about 13.5 percent for the week ending March 31, trading almost twice the 6.9 percent rate registered at issuance in 2014.

According to the exchequer, yields on Kenya’s Eurobonds declined by an average of 46.6 basis points in the past week, with the 2024 maturity coupon declining by 51.0 basis points.

Eurobonds’ yields have generally shrunk by almost 52 percent since they peaked in mid-July last year, depicting improved conditions towards debt servicing.

Read: World Bank Approves An Increase In Kenya’s Loan Request By KSh. 32 Billion

The prevailing global economic headwinds and the current structure of external debt have also pushed up the costs of debt servicing.

Commercial debt would have risen higher if the mid-2022 Eurobond had been issued, but a spike in the average yield on existing bonds, from 6.7 percent in January 2022 to 14.7 percent in June, made a launch financially unviable.

To cushion itself from the debt burden, between 2020 and 2022, the country shifted its borrowing from more multilateral and bilateral borrowing to concessional borrowing from the IMF, World Bank and the African Development Bank.

Kenya needs to strategize on successful redemption of the 2024 Eurobond, either via refinancing or by securing alternative loans to ease debt pressures.

Email your news TIPS to editor@thesharpdaily.com

Previous Post

Quickmart Opens Its 57th Branch In Kileleshwa

Next Post

New E- Mobility Tariff to Boost Uptake of Electric Vehicles

Dennis Otsieno

Dennis Otsieno

Related Posts

commercial illustrator
News

Why Kenyan private equity firms should consider continuation funds as an exit strategy

July 23, 2025
Business

Del Monte foods files for bankruptcy in USA

July 3, 2025
News

Private vs Public Pension Funds in Kenya

June 30, 2025
Investments

Investor shift to long term bonds drives oversubscription in CBK’s reopened auction

June 19, 2025
News

The real price of Israel – Iran Conflict for Kenya.

June 19, 2025
Economy

Resilient but strained: Kenyan firms speak out in May 2025 CEO survey.

June 19, 2025

LATEST STORIES

Segregated Pension Schemes in Kenya Q2’2025 Performance

August 8, 2025
Asset allocation dividing an investment portfolio among different asset categories.

Building a Retirement Portfolio in Kenya

August 8, 2025

Steps banks can take to align with fair lending practices

August 7, 2025

The hidden cost of outdated economic statistics

August 7, 2025

EABL posts 12.2% profit surge, strengthens regional footprint despite rising illicit trade

August 1, 2025
1049795356

Maximizing Your Pension Contributions

August 1, 2025

The functional role of narrative in financial markets

August 1, 2025

Tanzania’s protectionist shift and what it means for Kenyan entrepreneurs and regional trade

July 31, 2025
  • About Us
  • Meet The Team
  • Careers
  • Privacy Policy
  • Terms and Conditions
Email us: editor@thesharpdaily.com

Sharp Daily © 2024

No Result
View All Result
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team

Sharp Daily © 2024