The Kenyan Government has secured a Syndicated Medium-Term Loan Facility amounting to USD 500 million to finance development projects in 2023/4 budget. The loan, which has a tenure of 3 years and 5 years, was facilitated by Citibank, Rand Merchant Bank (RMB), The Standard Bank of South Africa and Standard Chartered Bank.
The financial institutions were appointed as Bookrunners and Initial Mandated Lead Arrangers by the Kenyan Government. Additionally, the Africa Export-Import Bank joined the Facility as a Bookrunner and Mandated Lead Arranger, with its contributions directed towards the longer-term tranche.
The proceeds from this substantial loan will be channeled through the National Treasury to support the implementation of development projects outlined in the approved development budget for the Fiscal Year 2022/2023.
The syndication which comes amid the backdrop of challenging credit market conditions in the emerging markets signifies continued confidence by investors in Kenya’s economic recovery path.
Kenya’s economy has remained resilient, growing at 4.8 percent in 2022 compared to a growth of 7.6 percent in 2021. The growth slowdown is attributed to unprecedented two consecutive years of contraction in the agricultural sector occasioned by severe climate shocks reflected in persistent drought.
However, Kenya’s growth prospects remain positive, supported by favourable weather conditions, and subsidized fertilizer, expected to boost agricultural production and improve food security; continued economic recovery across various sectors due to easing of economic impact of COVID-19 pandemic; and the implementation of the Government’s Bottom-Up Economic Transformation Agenda (BETA) that targets specific sectors with large impact on the economy on the transformation agenda.
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