KENYA AND CHINA FINALIZE LOAN DEAL

Officials from the Kenya National Treasury are currently in China to finalize a Ksh358 billion loan. The country is in advanced negotiations to secure the funds through the Chinese financial markets. The loan is intended to finance the continuation of the Standard Gauge Railway(SGR) project, specifically the segment between Naivasha and Malaba, near the Ugandan boarder. The proposed financing will involve the issuance of a Panda Bond, a yuan denominated bond issued by a foreign government and sold on the Chinese market. China, which has been the primary financier of the first two faces of the SGR (Mombasa-Nairobi and Nairobi-Naivasha) is expected to play a central role once again through this new bond structure.
The Treasury is currently finalizing the technical aspects of the agreement, with full details expected to emerge within two to three weeks. Kenya Prime Cabinet Secretary and Foreign Affairs Minister, Musalia Mudavadi has expressed Kenya’s appreciation for Chinese support and stated that the government is relying on Beijing’s support to launch the Panda Bond and the start of the upcoming budget cycle.