Finance Kenya nears $1.5bn loan from UAE to address budget gap By Pramod Kumar September 26, 2024, 5:00 AM Reuters/Caitlin Ochs Kenya's president William Ruto. A UAE loan will help the East African nations's budget deficit, which is expected to rise to 4.3 percent of GDP this year Kenya is close to securing a $1.5 billion loan from the UAE to address its budget financing gap. The loan will have an interest rate of 8.2 percent, Reuters reported, citing people familiar with the talks. “The deal is as good as done,” an unnamed source said, adding that the move will diversify the government’s budget support options. Kenya’s budget deficit is expected to rise to 4.3 percent of GDP this year, up from an earlier estimate of 3.3 percent, with a delayed International Monetary Fund (IMF) support deal worsening the situation. UAE and Kenya complete Cepa negotiations UAE and Kenya sign mining and technology deal G42 and Microsoft to invest $1bn in Kenya data centre In February, Nairobi issued a $1.5 billion seven-year Eurobond, paying an exorbitant 10.375 percent yield. The funds were used to manage its debt maturities. The East African nation has strengthened its relations with the UAE after president William Ruto took office in September 2022. In 2018, the UAE loaned Ethiopia $1 billion to handle a hard currency cash crunch. This year Abu Dhabi sovereign fund ADQ acquired the rights to develop Ras El Hekma in a $35 billion deal with the Egyptian government, aimed at meet Cairo’s liquidity needs. Register now: It’s easy and free AGBI registered members can access even more of our unique analysis and perspective on business and economics in the Middle East. Why sign uP Exclusive weekly email from our editor-in-chief Personalised weekly emails for your preferred industry sectors Read and download our insight packed white papers Access to our mobile app Prioritised access to live events Register for free Already registered? Sign in I’ll register later
