NAIROBI, March 27 (Xinhua) — Kenya plans to reduce its dependence on external creditors in a new debt strategy, a senior official said on Wednesday.
John Mbadi, cabinet secretary for the national treasury and economic planning, told journalists in the Kenyan capital of Nairobi that the country aims to reduce debt costs and risks by sourcing 25 percent of borrowing from external sources and 75 percent from domestic sources over the medium term.
“Tapping domestic debt is necessary in order to mitigate against exchange rate risks on Kenya’s external debt,” Mbadi said during the launch of the Medium Term Debt Management Strategy.
The strategy outlined the strategies and initiatives to minimize costs and management of risks of public debt over the medium term.
According to the National Treasury, at the end of June 2024, the total public debt stock hit about 10.5 trillion Kenyan shillings (about 81.8 billion U.S. dollars), out of which domestic debt was 51.1 percent while external debt was 48.9 percent.
Chris Kiptoo, principal secretary for the national treasury and economic planning, said that Kenya seeks to gradually lengthen the maturity of public debt instruments as well as deepen the domestic debt market through the issuance of medium to long-term debt securities accompanied by debt reforms.
Multilateral debt accounts for 53.9 percent of foreign debt, reflecting the country’s strategy of maximizing the use of concessional financing and minimizing the use of commercial debt, Kiptoo said.
