Kenya has paid off about US$415.4 million (Sh53.59 billion) of its external sovereign debt, the Treasury announced on February 27, 2026, following the success of a tender offer targeting two series of its Eurobonds.
The February 18 tender sought holders of the 7.25 per cent Eurobonds due 2028 and the 8.00 per cent amortising notes due 2032 to sell their holdings back to the government. Investors tendered $90.5 million worth of the 2028 bonds, which was accepted in full, and $892.1 million worth of the 2032 bonds, far above what Kenya intended to purchase.
Since interest for the 2032 notes outstripped Kenya’s $400 million purchase target, authorities used a proration factor of roughly 0.33, accepting about $324.8 million of the 2032 notes to reach a total retirement figure of around $415.4 million comprising all 2028 bonds accepted and some 2032 notes.
The repurchase bonds will be settled and cancelled on March 3, 2026, ceasing to exist in the market. The price at which they were purchased included a premium on face value and compensation to investors for leaving their positions before maturity.
Kenya financed the operation partly using proceeds from its recent $2.25 billion dual-tranche Eurobond issue which has long-dated notes due in 2034 and 2039, thereby extending maturities of its debt obligations and easing its redemption schedule.
Authorities described the transaction as part of liability management strategy aimed at shoring up the nation’s fiscal stability and boosting investors’ confidence in Kenya’s economic path. Finance officials added that the broad uptake reflects enduring interest in Kenyan sovereign debt amidst global fundraising challenges.
By lengthening maturities into the mid-to-late 2030s, the government will reduce the immediate pressure associated with upcoming bullet payments, thus creating a more manageable schedule for debt servicing obligations. Economists explain such strategies can help minimise refinancing risk and afford policy makers greater fiscal flexibility.
Kenya’s current Eurobond operations are a signal of the general shift emerging market issuers are making to refinancing short-dated maturities with longer-dated ones in efforts to hedge against the tight global financial environment. However,Some economists warn that refinancing bonds might bring immediate reprieve but it may mean incurring more debt over time if interest rates move unfavorably. The market response, however, suggests sustained investor trust in Kenya’s policy trajectory.
