Kenya Borrowing Plan Reaches for Yen, Yuan and Sukuk Money
The Treasury’s 2026/27 borrowing plan leans on Japanese money and liability management, and keeps a Chinese panda bond and an Islamic sukuk as options rather than commitments. The post Kenya Borrowing Plan Reaches for Yen, Yuan and Sukuk Money appeared first on The Rio Times .
Kenya's National Treasury has released its Annual Borrowing Plan for 2026/27, outlining a strategy to diversify the country's funding sources beyond the dollar market. The plan projects a budget deficit of 5.5% of GDP, down from 6.8%, and further reductions to 3.9% and 3.6% in subsequent years. The external financing component amounts to KSh703.7 billion, or approximately US$5.41 billion, comprising US$335 million in grants and various debt instruments.
Among these, a US$815 million Eurobond is scheduled for issuance in the second quarter of 2026, followed by a US$500 million sustainability-linked bond and US$763 million from the World Bank and African Development Bank. Japan is the largest non-dollar contributor, providing US$881 million through a loan backed by NEXI, another loan backed by the Africa Finance Corporation, and a US$500 million samurai bond.
Additionally, the plan outlines potential options for a US$300 million panda bond and a US$500 million sukuk, both of which are currently subject to legal and regulatory approvals. The Treasury also commits to retiring at least US$500 million of high-cost external debt and completing a US$1 billion debt-for-food-security swap with the US International Development Finance Corporation by March 2027.
This consolidation of debt aims to reduce borrowing costs and improve Kenya's overall financial stability.
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