Kenya bonds maintain Friendly investor view Despite Election Fever: Exotix

Provisional results from the IEBC for the presidential election vote held on 8 August show incumbent President Uhuru Kenyatta comfortably in the lead with 54.3% of the vote, compared to the main opposition candidate Raila Odinga on 44.8%, with 97.7% of the votes tallied (as of 10.40am BST on 10 August).

Odinga has called the results “fake”, although his allegations of fraud and hacking have been dismissed by the IEBC, but we await the final official vote count which is due to be declared within 7 days of the election (15 August).

There is then a constitutional process if Odinga, and other candidates, want to challenge the result. Petitions can be submitted on 16 August, with hearings running for 20 days from 17 August, culminating in a Supreme Court decision.

In the meantime, there have been reports of protests and unrest in some opposition strongholds, stirring memories of 2007.

According to Exotix Capital, it looks like Kenyatta will secure a first round win, in which case, much will then depend on how Odinga responds, whether he looks to the courts for review (2013 scenario), mobilises protesters (2007) or concedes. Bond investors seemingly have a benign view about election risks, with the Kenya’s Eurobonds due 2024 even falling 30bp this week to 6.2%, but that view could be tested if protests pick up.

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Exotix Capital