- Japan will provide Kenya up to ¥25 billion ($169m) in Samurai financing to boost vehicle assembly and cut power losses.
- Kenya is also negotiating with China to shift dollar debt into yuan and extend repayment, aiming to ease costs and free fiscal space.
Japan will provide Kenya with up to 25 billion yen ($169 million) in Samurai financing to boost the country’s vehicle assembly and energy sectors.
Mudavadi signed the agreement with Atsuo Kuroda, CEO of Nippon Export and Investment Insurance (NEXI). He said the facility would strengthen Kenya’s local vehicle assembly and parts manufacturing industry while tackling electricity transmission and distribution losses, which currently account for about 23% of national output.
In addition, the deal comes as Kenya negotiates a separate term sheet with China to restructure part of its dollar-denominated debt into yuan and extend repayment terms, to cut sovereign borrowing costs. Kenya spends about $1 billion annually servicing obligations to China, its largest bilateral creditor.
On the sidelines of the Tokyo International Conference on African Development (TICAD), Raphael Otieno, director-general of debt management at Kenya’s finance ministry, said Nairobi is shifting strategy from short-term refinancing risks to reducing expensive debt.
Kenya is exploring sustainability-linked bonds with guarantees, yen-denominated Samurai bonds, renminbi-denominated Panda bonds, and debt swaps. The Treasury has also prepaid some domestic bonds and plans more such operations. Officials estimate switching repayment from dollars to yuan could nearly halve interest costs and create fiscal space.