The bond will have a 16-year maturity and a 15-year weighted average life. It is expected to be of a "benchmark size," meaning it will meet the standard for large international investments.

Benin’s move comes at a time of strong investor interest in bonds from emerging markets, especially African nations.

“The government wants to take advantage of good market conditions,” Ousseynou Diagne, head of Africa debt capital markets at Societe Generale told Bloomberg .

This bond will be issued just under a year after Benin’s last dollar bond sale.

As part of this plan, Benin is also offering to buy back some of its euro-denominated bonds due in 2032, using a loan from a commercial bank.

This Eurobond will help Benin diversify its funding and strengthen its economy during uncertain times.

Treasury Cabinet Secretary Njuguna Ndung'u told Business Daily that the government is ready to shift its focus towards eastern markets following a prosperous Eurobond sale.

He said the plan entails accessing the Chinese market through a Panda bond, targeting the Japanese market with a Samurai bond, and engaging the Middle East with a Sharia-compliant Sukuk bond.

“Yes indeed. We need to diversify to other markets, the Chinese market with Panda bonds, the Japanese market with Samurai bonds, and the Middle East with Wakala Sukuk bonds. All these diversified bond markets will support financing projects and programmes under the Bottom-Up Economic Transformation Agenda,” Prof Ndung’u said

With this, the country aims to reduce its dependence on Western capital markets.

Kenya’s parliament has voted to approve the Affordable Housing Bill of 2023. The bill aims to establish a legal foundation and structure for the collection of the housing levy, as mandated by a court ruling. There were, however, amendments from both sides of the political spectrum. Amendments introduced during the debate in the house included provisions to regularize the already collected housing levy, allow for voluntary contributions, and establish an independent body tasked with administering the levy. Additionally, the sharing of the levy among various program implementers, including county governments and the National Housing Corporation, was incorporated into the bill. However, the proposal to have the levy deducted from the net or basic salary faced opposition. This led to a section of opposition MPs leaving the chambers, vowing to seek legal recourse against the newly approved law, KBC reports. The bill, now with the introduced amendments, is slated to be forwarded to the Senate for concurrence before being presented to the President for final approval.

Exports to Canada

Kenya and Canada are set to strengthen their bilateral trade and investment ties, Trade and Investment Cabinet Secretary Rebecca Miano has revealed. Emphasizing the importance of fostering a robust business environment, Kenya is actively pursuing collaborative efforts with the private sector. Canada stands as a significant trade partner for Kenya, with exports estimated at $18.71 million (Sh2.7 billion) in 2022, based on the United Nations COMTRADE database on international trade, the Star reports. Despite this, the trade value between the two nations has seen limited growth, experiencing a decline in Canadian imports for consecutive years in 2020 and 2021. The Cabinet Secretary, Rebecca Miano, shared that the Ministry of Trade and Investment is currently engaged in negotiations to expand market access. “Kenya is the gateway to Africa, and therefore your choice of Nairobi as the venue for this 2nd Canada-Africa Business Forum is no doubt strategic," she said.

Fuel prices

The Kenyan government has tripled the tax payable to the Energy and Petroleum Regulatory Authority (EPRA) for every litre of fuel purchased. The Ministry of Energy recently raised the Petroleum Regulatory Levy from Ksh0.25 to Ksh0.75 per liter, a threefold increase. This specific levy is one among nine taxes and levies imposed on fuel, and the additional funds generated are earmarked for supporting the operations of the energy regulator. The comprehensive list of taxes and levies on fuel includes excise duty, Road Maintenance Levy, Petroleum Development Levy, Railway Development Levy, Anti-Adulteration Levy, Merchant Shipping Levy, Import Declaration Fee, and Value Added Tax (VAT), the East African reports. Despite the significant hike in the Petroleum Regulatory Levy, the increase went relatively unnoticed, as the energy regulator simultaneously reduced the overall fuel price by Ksh1 per liter.

Kenya’s Eurobond

Kenya’s Eurobond yields have recently entered single-digit territory, signalling a positive shift in investor sentiment after the partial repayment of the Ksh285.6 billion ($2 billion) debut Eurobond. As investor fears dissipate, interest rates on the Eurobond maturing in June have seen a notable decline, dropping to 9.93 percent as of Monday's close, down from a peak of 15.09 percent recorded on February 9, 2024. This trend is mirrored in other Eurobond issuances, with yields on the seven-year sovereign bond maturing in 2027 hitting a low of 8.611 percent, down from 11.64 percent over the same period. An economist at IC Asset Managers, Churchill Ogutu, told the East African that “the risk premium attached to the 2024 Eurobond has eased, leading to the fall in yields. This has had the contagion effect of cutting yields in other issued Eurobonds as investors begin to look at Kenyan assets favorably.” Similarly, yields on the 10-year Eurobond maturing in 2028, the 12-year bond maturing in 2032, and the 13-year bond maturing in 2034 have all experienced declines, settling at 9.475 percent, 9.939 percent, and 9.749 percent, respectively. The move towards single-digit yields reflects a growing confidence among investors, potentially driven by the partial repayment of the debut Eurobond and improving economic conditions.

Online visitor registration fees

The Department of Immigration and Citizen Services has announced that citizens of Ethiopia and several other nations will no longer be required to pay the $30 fee per traveler when applying for entry to Kenya. The fee will no longer be applicable to citizens of Comoros, Congo-Brazzaville, Eritrea, Mozambique, San Marino, and South Africa. The exemption for these countries, effective February 15, is attributed to the visa abolition agreements or bilateral visa waiver agreements they have established with Kenya, the Nation reports. Bacha Debele, the Ethiopian Ambassador to Kenya, expressed gratitude for Kenya's swift decision to eliminate the payment requirement for Ethiopian citizens seeking eTA, the Nation reports. He clarified that while Ethiopian citizens can now enter Kenya without a visa-related payment, the mandatory completion of the eTA form online before arrival remains in place.

What they said

Portfolio manager for emerging markets hard currency debt strategy at asset manager Ninety-One, Thys Louw, said, "There could be some risk regarding a delay as the (new) minister of finance catches up. But overall, this is unlikely to derail a deal before the elections. The broad parameters of what is required to get a deal are well understood by both sides and unlikely to be altered by a new minister of finance."  Further, emerging markets debt portfolio manager at Vanguard, Nick Eisinger said, “We know that the government had received very mixed feedback from investors when they revealed the initial parameters of the restructuring back in October/November and that more work is needed.” "We interpret this (change) as a signal that fiscal consolidation slippages to salvage the ruling party's flailing electoral campaign are now more certain," said Bright Simons, IMANI Africa vice president.  

What they said

The IMF mission chief for Kenya, Haimanot Teferra, said that the International Monetary Fund does not anticipate Kenya defaulting on the repayment of its Eurobond. Teferra expressed confidence that Kenya would successfully navigate through the liquidity pressure associated with the maturing Eurobond. "We don't think Kenya will default on the Eurobond. The discussion yesterday and the board's approval of the review and the additional funding is in recognition of that," she is quoted by Reuters . The IMF has further indicated in its report that "Kenya's re-access to the Eurobond market in 2024 at a reasonable cost for a full rollover of its US$2 billion Eurobond maturing in June 2024 is unlikely. Kenya is at a high risk of debt distress , and public debt is estimated to have reached 73 percent of GDP by end-2023, with debt service consuming about 55 percent of revenues," the IMF said. Meanwhile, the finance minister and central bank chief has said that "we are pursuing alternative sources of financing from multilateral and bilateral lenders and the syndicated loans market.”