IMF Country Report No. 18/295 (October 2018) contains the previous DSA conducted jointed with the World Bank.
Kenya’s debt-carrying capacity remains strong, as its CI, at 3.12 based on October 2019 WEO, remains above the upper threshold value of 3.05.
County governments have not been allowed to borrow without government guarantee since 2010 while extra-budgetary units face no such constraint.
The June 2014 issuance comprised two tranches: a five-year $500 million bond at a coupon of 5.875 percent, and a 10-year $1.5 billion bond at 6.875 percent. In December 2014, Kenya added $250 million to the five-year tranche at a 5.0 percent yield and $500 million to the 10-year tranche at 5.9 percent. In June 2019, the $750 million five-year tranche matured.
The February 2018 issuance comprised two tranches: a 10-year $1 billion bond at a coupon of 7.25 percent and a 30-year $1 billion bond at 8.25 percent
The May 2019 issuance comprised two tranches: a 7-year $900 million bond at a coupon of 7 percent and a 10-year $1.2 billion bond at 8 percent.
The World Bank’s Country Policy and Institutional Assessment (CPIA).
The October 2018 DSA found that in the baseline external debt service to exports exceeded the high-risk threshold for two years and that the ratio of debt service to exports touched the threshold for one year, which made the mechanical external risk of debt distress high. There was also a breach of the present value of external debt to exports in the stress test scenario. Given that the baseline breaches were temporary and related to a bullet Eurobond repayment, and in view of Kenya’s strong access to international markets and a comfortable level of reserves, the final risk of debt distress was assessed as moderate with the use of judgement.