SPECIAL REPORT: KENYA’S INCOMING GOVERNMENT MAKES U-TURN ON AUSTERITY AND DEBT RESTRUCTURING

   Mon, 24 October 2022

The incoming government is seeking to retire costly long-term treasury bonds and to extend maturities on defaulting infrastructure loans owed to Chinese creditors. Kenya might be able to secure concessional institution support for domestic debt reprofiling, but even a partial restructuring of external debt will be complicated by China’s reluctance to cap interest rates. The new government will need debt relief of some form, and make austerity cuts elsewhere, to fund its ambitious growth and employment boosting agenda, as well as new plans for food support.

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