Kenya

Kenya’s government said it will repurchase the bulk of its outstanding June 2024 dollar bonds, a move to shore up market confidence amid concerns about repaying the $2 billion principal, Bloomberg News reported. The East African nation plans to buy back as much as $1.44 billion of notes, according to a Thursday press release. That’s up from an initial amount of $1.4 billion it had set. Kenya sold $1.5 billion of new eurobonds this week for the rollover, aided by the falling cost to issue debt.

Kenya’s central bank unexpectedly raised its benchmark interest rate for the second time since Governor Kamau Thugge took office in June, citing the need to support the country’s battered shilling, Bloomberg News reported. The monetary policy committee increased the rate by 200 basis points to 12.5%, the largest increase since 2011. The news was announced by Thugge in an emailed statement Tuesday from the capital, Nairobi. Only one of the seven economists surveyed by Bloomberg forecast an increase.

Kenya’s President William Ruto sought $1 billion more in loans from China Monday, despite rising public debt that has now reached $70 billion in the Eastern African country, according to National Treasury figures for 2022/2023, the Associated Press reported. President Ruto was was one of a number of global leaders in Beijing to attend the tenth anniversary meeting of China’s Belt and Road Initiative, the ambitious plan that aims to connect Africa, Asia and Europe through massive infrastructure and energy projects.

A Kenyan parliamentary panel called on the country's information technology regulator on Monday to shut down the operations of cryptocurrency project Worldcoin within the country until more stringent regulations are put in place, Reuters reported. The government suspended the project in early August following privacy objections over its scanning of users' irises in exchange for a digital ID to create a new "identity and financial network". Worldcoin was rolled out in various countries around the world by Tools for Humanity, a company co-founded by OpenAI CEO Sam Altman.

Kenya’s central bank reopened a sale of treasury bonds offered last week in a move aimed at keeping a lid on financing costs after investors demanded higher yields, Bloomberg News reported. The Central Bank of Kenya said Tuesday it would seek to raise 21 billion shillings ($145.4 million) from a tap sale of the two-year and five-year treasury bonds sold on Aug. 16. The auction comes after the central bank pushed back at investors demanding higher yields at its auction last week as it allotted only 19 billion shillings out of 53 billion shillings tendered for its debt sale.

Kenya is in talks with the World Bank and European Union to ramp up its “Hustler Fund” project that is already providing cheap credit to more than 20 million of the country’s poor, Bloomberg News reported. A top government official said the World Bank was discussing backing that could amount to as much as 20 billion shillings ($139 million), including via an existing program to support small enterprises. Combined with investments from the Treasury, this could leverage lending of 200 billion shillings over the next five years.

Kenya's interior ministry said on Wednesday that it had suspended the local activities of cryptocurrency project Worldcoin while government agencies assess potential risks to public safety, Reuters reported. The project founded by OpenAI CEO Sam Altman launched last week. It requires users to give their iris scans in exchange for a digital ID, and in some countries users also get free cryptocurrency as part of plans to create a new "identity and financial network".

Kenya is considering options including a potential buyback of part of a $2 billion bond due next year, Bloomberg News reported. Chris Kiptoo, the principal secretary of the National Treasury, declined to confirm the possible debt repurchase, but said the country is in talks with advisors and reviewing other alternatives. “We have many options,” he said in an interview.

The World Bank said on Tuesday it approved a $1 billion loan to Kenya to support its budget as East Africa's economic powerhouse confronts high debts and a weakening currency, Reuters reported. The lending will be done through an instrument called a Development Policy Operations (DPO) loan, which commits Kenya to instituting reforms aimed at creating fiscal space, improving agricultural competitiveness and improving governance.