The Government of Kenya has successfully raised USD 1.5 billion (Ksh193.8 billion) from international investors in a fresh Eurobond deal while simultaneously paying off USD 1 billion of its 2028 Eurobond ahead of schedule, the National Treasury announced on Friday, October 3rd.

In a press release, the Treasury emphasized that the move reflects the government’s “firm commitment to managing debt more wisely, paying off loans on time, and protecting Kenyans from sudden repayment shocks.”

This marks the third such debt transaction since 2024, underscoring the administration’s focus on proactive debt management.

According to the National Treasury, the financing was secured in two tranches: a seven-year loan at an interest rate of 7.875 percent and a twelve-year loan at 8.8 percent.

Combined, this translated into a blended rate of 8.7 percent, which is one percentage point lower than what Kenya would have paid at the beginning of the year.

“The success of this transaction smoothens and lengthens loan repayments, giving Kenya more breathing space in managing its finances,” the statement read.

Officials noted that the improved terms would ease pressure on taxpayers and reduce the government’s expenditure on interest repayments.

Investor Confidence

Investor response was overwhelmingly strong, with bids exceeding USD 7.5 billion, five times more than the government’s initial target of USD 1.5 billion.

Most of the support reportedly came from established international fund managers in the United States and the United Kingdom.

Treasury officials said the robust investor appetite is a clear signal of growing global confidence in Kenya’s economy.

“This achievement demonstrates renewed trust in the country’s fiscal and economic management,” the statement added.

Impact on Economy

Treasury Principal Secretary Dr. Chris Kiptoo, said the move would not only stabilize the economy but also free up resources to finance critical development projects.

“This success means Kenya will spend less on interest, ease pressure on taxpayers, and keep the economy stable while creating room to fund development priorities such as roads, health, and education,” Kiptoo stated.

Analysts view the early repayment of part of the 2028 Eurobond as a positive step in reducing the risk of repayment shocks and improving Kenya’s credit standing.

By spreading out debt obligations over longer maturities, the government hopes to cushion the economy from sudden fiscal pressures.

The announcement comes at a time when Kenya faces mounting public debt concerns, with the government pledging to prioritize sustainability while still meeting its development commitments.

Press Release by The National Treasury and Economic Planning. PHOTO/ Treasury.