Ruto Ditches Dollar Debt, Signs Ksh80 Billion Samurai Bond
On Thursday, February 8, President William Ruto’s government declared its intention to pursue a bond denominated in yen, with a value of Ksh80 billion.
In an announcement, Chris Kiptoo, the Principal Secretary of the Treasury, mentioned that the nation has formally entered into a Memorandum of Understanding (MoU) with Nippon Export and Investment Insurance (NEXI) to facilitate the issuance of a Samurai Bond.
Standing alongside NEXI Chief Executive Officer Atsuo Kuroda in Tokyo, Japan, Kiptoo declared that the agreement for the Samurai Bond would be reached between the National Treasury and NEXI.
A Samurai Bond refers to a bond denominated in yen that is issued in Tokyo by a company from outside Japan, and it is governed by Japanese regulations.
The announcement of the Yen-backed bond coincided with Kenya’s initiation of the repurchase of the Ksh321 billion Eurobond denominated in dollars, occurring within a day of each other.
“This agreement (MoU) enables Kenya to issue a Samurai Bond totaling USD500 million (Ksh80 billion) in two phases of USD 250 each,” Kiptoo announced.
The funds will be utilized to bolster e-mobility projects, which involve the promotion of electric vehicles (EVs) and the improvement of energy efficiency within Kenya’s transmission network.
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The National Treasury explained the rationale behind the Samurai Bond by stating that the enhancement of transformers would lead to a decrease in energy losses within Kenya’s transmission network.
“The bond will be utilized during the 2024/2025 Financial Year and is expected to conclude by June 2024,” the National Treasury explained.
President William Ruto remarked, following the MoU signing, that the Samurai Bond would enhance connections for industrial development and sustainable growth, while also fostering the presence of Japanese companies in Kenya.
President William Ruto has embarked on a three-day trip to Japan, during which he successfully obtained funding for several multibillion-dollar projects.
This comprises projects such as the Meru Wind Farm Energy valued at Ksh15 billion, the Isiolo Solar Energy project costing Ksh8 billion, and the Thika Vehicle Manufacturers project with a budget of Ksh800 million.
The Menengai Geothermal project and the promotion of electric vehicles have secured funding of Ksh75 billion for the President.
Ruto Ditches Dollar Debt, Signs Ksh80 Billion Samurai Bond
