NAIROBI — Kenya’s government kicked off a debt repurchase this week, aiming to swap out $500 million in maturing Eurobonds for fresh dollar bonds as global yields drop. Yields on the targeted 7.25 percent notes due February 2028 fell to 6.14 percent, while the 8 percent amortizing notes due May 2032 eased to 7.14 percent, according to Bloomberg data.

Lower yields signal cheaper borrowing ahead. The prospectus outlines offers at premiums: $1,035 per $1,000 face value for the 2028 tranche, plus $1,055 for 2032, on top of accrued interest. Bids opened Monday and close next Thursday, hinging on successful new bond sales in global markets.

National Treasury Cabinet Secretary John Mbadi flagged the plan last week during a briefing with financial journalists in Nairobi. “This debt operation reduces refinancing risk and cuts borrowing costs after markets warmed to Kenyan paper,” Mbadi said. The country issued the $1.2 billion 2028 bonds in February 2025 and $1 billion 2032 bonds in October 2024 to avert default on a June 2024 Eurobond.

Debt expert Paul Kemboi called it proactive management. “Better conditions let Kenya spread repayments, avoiding big bullet payments amid tight budgets,” Kemboi told reporters. He noted similarities to 2024 and 2025 buybacks that extended maturities.

Moody’s bolstered confidence weeks ago, upgrading Kenya’s long-term local and foreign currency issuer ratings to B3 from Caa1 on January 27, 2026. The agency shifted the outlook to stable. S&P, last month, stressed that macroeconomic gains and investor sentiment must hold for debt sustainability.

Kenya’s public debt hit 11.81 trillion shillings. External pressures mount from crowded maturities, sluggish revenues, and climate costs. Recent swaps have lengthened profiles, but critics warn new issuance merely rolls over expensive debt without shrinking the stock.

Officials bet on current rate dips before global shifts reverse them. The buyback ties old notes to new issuance, smoothing the repayment curve through 2032 and beyond.