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.
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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.
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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".
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The International Monetary Fund approved almost $1 billion for Kenya, saying the East African country had met conditions for continued financing under programs to help reform the economy and confront challenges posed by climate change, Bloomberg reported. Kenya got a $415 million disbursement under the Extended Fund Facility and Expanded Credit Facility, programs designed to shore up its economy and boost its foreign exchange reserves, following a fifth review.
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.
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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.
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The International Monetary Fund’s chief capped a visit to Kenya with an enthusiastic endorsement of its economic management and expressed confidence that the cash-strapped nation would keep servicing its debts, Bloomberg News reported. Kristalina Georgieva said that in the IMF’s assessment, Kenya’s debt is sustainable and the administration of President William Ruto is moving swiftly to improve its fiscal position. The remarks come at a sensitive time for the East African nation, with some investors dumping its bonds and questioning its ability to make a $2 billion payment next year.
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Kenya's central bank held its benchmark lending rate steady at 8.75% on Monday, its monetary policy committee said, saying its last hike in November was still working its way through the economy, Reuters reported. Six out of nine market participants polled by Reuters had predicted the bank would hold the rate steady, while three expected it would be raised. The move bucks the trend among major African central banks who have maintained a tightening stance into this year. Policymakers in Nigeria and South Africa hiked rates last week, while their Ghanaian counterparts hiked earlier on Monday.
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Kenya Airways PLC's pilots union will give its final decision later tonight on whether to begin a strike on Saturday after the government urged them to it call off, the transport minister said on Friday, Reuters reported. The walkout, which is due to start at 6.00 am local time, will affect thousands of business and leisure travelers at one of the most important aviation hubs in the continent.
Kenya plans to tighten spending and step up efforts to collect more tax as it seeks to bring ballooning state debt under control, Bloomberg News reported. The budget deficit is projected to drop to 6.2% of gross domestic product in the year through June 2023, Treasury Secretary Ukur Yatani said on Thursday in his budget speech to parliament in Nairobi, the capital. That compares with an estimated deficit of 8.1% of GDP this year. He plans to finance the 862.5 billion-shilling ($7.5 billion) gap by raising 581.7 billion shillings domestically and 280.7 billion shillings offshore.
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