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Kenya Debt Watch
Rank: Chief Joined: 5/31/2011 Posts: 5,121
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cc @Scubidu, umepotea sana
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Rank: Elder Joined: 12/4/2009 Posts: 10,701 Location: NAIROBI
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Going by the ksh.1.6 trillion budget estimates for 2013/2014 released the government is going to borrow heavily to finance it. KRA will collect about ksh.900B in the 2013/2014 financial year. Chances of banks interest rates coming further down look dim. Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Rank: Elder Joined: 11/7/2007 Posts: 2,182
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Iko shida LOVE WHAT YOU DO, DO WHAT YOU LOVE.
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Rank: Chief Joined: 5/31/2011 Posts: 5,121
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Rank: Chief Joined: 5/31/2011 Posts: 5,121
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Treasury eyes Sh20bn for infrastructureTreasury is seeking Sh20 billion in an infrastructure bond, the first such issue in two years. The sale of the 12-year bond is scheduled to close on September 24. Buyers will earn a fixed annual return of 11 per cent as per the indicative coupon rate, though the average yield will depend on investor bids for the paper. The infrastructure bonds issued in 2010 were of eight and nine-year tenures. The Treasury has budgeted Sh10.1 billion for financing water, sewerage and irrigation projects, Sh14.3 billion for the transport sector and Sh11.6 billion for energy. The total cost of the projects is Sh36 billion, but CBK clarified yesterday that the Sh20 billion bond is only meant to cover part of the cost. If the total amount is raised, it will be the second largest amount the government has realised from the market since the infrastructure bond issues began in 2009. The biggest amount raised was Sh32.8 billion in August 2010.
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Rank: Elder Joined: 6/8/2013 Posts: 2,517
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Kwani hiyo ingine is interest or new borrowings na bado kulipa Raila na Kalonzo and JSC wants more money "😖😡KQ makes money for everyone except the shareholder 😏😏 " overheard in Wazua
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Rank: Veteran Joined: 9/4/2009 Posts: 700 Location: Nairobi
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Kenya debt to GDP up 10% since the start of 2013 at 56.2%. what does it mean when public debt is growing by 12% and GDP by 5% in 2013? “We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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Rank: Veteran Joined: 9/4/2009 Posts: 700 Location: Nairobi
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From rising star to almost basket case: Tough lessons for Kenya from Ghana Read more: http://www.nation.co.ke/...2/-/7kh42gz/-/index.html“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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Rank: Elder Joined: 9/23/2010 Posts: 2,221 Location: Sundowner,Amboseli
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[quote=Scubidu]From rising star to almost basket case: Tough lessons for Kenya from Ghana Read more: http://www.nation.co.ke/.../-/7kh42gz/-/index.html[/quote] Welcome back @Scubidu. That article should take us back to the drawing board. I'm waiting to see whether the yields on this week's T/Bill auction will stay unchanged. Last week saw an undersubscription in the 91 day paper.The KES already feeling the heat. @SufficientlyP
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Rank: Veteran Joined: 9/4/2009 Posts: 700 Location: Nairobi
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Sufficiently Philanga....thropic wrote:[quote=Scubidu]From rising star to almost basket case: Tough lessons for Kenya from Ghana Read more: http://www.nation.co.ke/.../-/7kh42gz/-/index.html[/quote] Welcome back @Scubidu. That article should take us back to the drawing board. I'm waiting to see whether the yields on this week's T/Bill auction will stay unchanged. Last week saw an undersubscription in the 91 day paper.The KES already feeling the heat. I think domestic interest rates will remain fairly unchanged until next month and until the next few months to the end of the year, the 91D Tbill rates won't move much coz of the KBRR. Treasury are counting on the single treasury account to help smoothen out the domestic borrowing programme (thus reduce inefficiencies) and hopefully give them scope to lower the borrowing requirements this year. The article has some good points but assumes that everything is a standstill and debt is the only thing expanding exponentially. The debt is financing infrastructure and could potentially accelerate revenues but the financing costs he's referring to are rather small (can be serviced). But the point about rolling over the debt in give years is key but provided Treasury doesn't get overzealous on fcy borrowing I think we can roll them over comfortably. “We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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Cheers @scubidu
@hisah, remember the queries over Ghana/Cedi vis-a-vis Bots/BWP in preparation for UG/UGX, BoP?
Boss, smack down.
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Rank: Elder Joined: 9/23/2010 Posts: 2,221 Location: Sundowner,Amboseli
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Scubidu wrote:Sufficiently Philanga....thropic wrote:[quote=Scubidu]From rising star to almost basket case: Tough lessons for Kenya from Ghana Read more: http://www.nation.co.ke/.../-/7kh42gz/-/index.html[/quote] Welcome back @Scubidu. That article should take us back to the drawing board. I'm waiting to see whether the yields on this week's T/Bill auction will stay unchanged. Last week saw an undersubscription in the 91 day paper.The KES already feeling the heat. I think domestic interest rates will remain fairly unchanged until next month and until the next few months to the end of the year, the 91D Tbill rates won't move much coz of the KBRR. Treasury are counting on the single treasury account to help smoothen out the domestic borrowing programme (thus reduce inefficiencies) and hopefully give them scope to lower the borrowing requirements this year. The article has some good points but assumes that everything is a standstill and debt is the only thing expanding exponentially. The debt is financing infrastructure and could potentially accelerate revenues but the financing costs he's referring to are rather small (can be serviced). But the point about rolling over the debt in give years is key but provided Treasury doesn't get overzealous on fcy borrowing I think we can roll them over comfortably. Thanks @Scubidu,i'd forgotten about KBRR and their need to maintain it at single digit,atleast for 1 year. On the coloured part, i hope much of the debt won't be eaten up paying for 'imagined' reclaimed/purchased land as happened in Ghana. @SufficientlyP
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Rank: Veteran Joined: 9/4/2009 Posts: 700 Location: Nairobi
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Sufficiently Philanga....thropic wrote:Scubidu wrote:Sufficiently Philanga....thropic wrote:[quote=Scubidu]From rising star to almost basket case: Tough lessons for Kenya from Ghana Read more: http://www.nation.co.ke/.../-/7kh42gz/-/index.html[/quote] Welcome back @Scubidu. That article should take us back to the drawing board. I'm waiting to see whether the yields on this week's T/Bill auction will stay unchanged. Last week saw an undersubscription in the 91 day paper.The KES already feeling the heat. I think domestic interest rates will remain fairly unchanged until next month and until the next few months to the end of the year, the 91D Tbill rates won't move much coz of the KBRR. Treasury are counting on the single treasury account to help smoothen out the domestic borrowing programme (thus reduce inefficiencies) and hopefully give them scope to lower the borrowing requirements this year. The article has some good points but assumes that everything is a standstill and debt is the only thing expanding exponentially. The debt is financing infrastructure and could potentially accelerate revenues but the financing costs he's referring to are rather small (can be serviced). But the point about rolling over the debt in give years is key but provided Treasury doesn't get overzealous on fcy borrowing I think we can roll them over comfortably. Thanks @Scubidu,i'd forgotten about KBRR and their need to maintain it at single digit,atleast for 1 year. On the coloured part, i hope much of the debt won't be eaten up paying for 'imagined' reclaimed/purchased land as happened in Ghana. @sufficient... I have no doubt some of the money will be misappropriated. We have way too much impunity in the public sector and I don't think the government is capable of fighting the corruption (making an example of someone). Auditor general keeps exposing negligence every day but the cost of paying debt is on us. For now they can't afford to raise taxes so they'll open that infinite government checkbook (CBK O/D) and hope we don't turn into Argentina. “We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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Rank: Veteran Joined: 9/4/2009 Posts: 700 Location: Nairobi
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Public debt rises to 57 per cent of GDP Read more: http://www.businessdaily...8/-/152ycgq/-/index.html“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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[quote=Scubidu]Public debt rises to 57 per cent of GDP Read more: http://www.businessdaily.../-/152ycgq/-/index.html[/quote] Piling up external debt. Any mismanagement of these funds and KES will take sizable FX losses ballooning the interest payments  Such a liquidity squeeze with the banking NPLs load still lingering post 2011 would cause serious financial chaos.
Look at ghana trying to play catch up with their CBR. Rates have spiked to GFC levels...! Yield curve has inverted as liquidity piles into the short end like KE back in 2011. 
If KE is not careful this script will play out making 2011 seem like a small test
Yield curve chaos - http://tinyurl.com/ktfbzlo
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Member Joined: 8/16/2012 Posts: 660
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The national debt vs the trade deficit. Trade deficit due to huge imports and low exports (pesa mashinani/counties imekuwa ya ku-import magari) Massive borrowing by GOK - same fate to a large chunk of the borrowed $$ diverted to import of luxuries Same interesting thoughts VituVingiSana wrote:mwekez@ji wrote:hisah wrote:As long as gok has crazy bills to pay next year after those tbills and tbonds rocketed, the bulls will find it hard to float the market because of that pay day period. While hoping that another banking event doesn't pop up! Keep this in mind. gok will be trading expensive bills for cheap ones. that should be okay. Not really the case. The expensive T-Bills have been issued and many go out for 12 months at 22%. The cheaper T-Bills are thanks to QE by CBK as a response to the collapse of Imperial Bank & the panic withdrawals from (good) Tier 2 & 3 banks. CBK is entering into Reverse Repos with many banks at the CBR rate to inject liquidity. This was a good move by PNN otherwise more banks could have had liquidity issues. http://www.businessdaily...6/-/5r3ttd/-/index.html
Ultimately, the answer lies in FISCAL DISCIPLINE. The new short-term (2-yr) USD 600mn facility will come back to bite us before we know it. And then the 5-yr T-Bond (issued in 2014) soon thereafter. I do not even know what the terms of the Chinese loans are. As @hisah says... elections do not make for fiscal discipline especially when the incumbent is running for re-election . The pain comes after the election. Live and learn; and don’t forget, nothing ventured, nothing gained.
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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Current account savings are major; energy self sufficiency, local food produce, lower global fuel prices.
That Punguza Mzigo proposal is very grand. When adopted it will take care of waste & create money to repay & finance capital expenditure.
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Rank: Member Joined: 8/16/2012 Posts: 660
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Cde Monomotapa wrote:Current account savings are major; energy self sufficiency, local food produce, lower global fuel prices.
That Punguza Mzigo proposal is very grand. When adopted it will take care of waste & create money to repay & finance capital expenditure. *IF..Unfortunately it is just part of political hot air to take the shine off each other. Live and learn; and don’t forget, nothing ventured, nothing gained.
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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Museveni wrote:Cde Monomotapa wrote:Current account savings are major; energy self sufficiency, local food produce, lower global fuel prices.
That Punguza Mzigo proposal is very grand. When adopted it will take care of waste & create money to repay & finance capital expenditure. *IF..Unfortunately it is just part of political hot air to take the shine off each other. Then too bad. We'll eat politics. The man has a point, when did Wanjiku hit a jackpot to sustain the Constitution? I wonder with our opposition, in that what type of government/country would they want to ascend to if they won the elections? One that works, or one that doesn't? They should be offering viable counter proposals. Default settings should be we have a country that works! What will personally displease me most is the politicos making their way back to the executive. Let the CSs remain as professional and technocratic as possible. Minimal interference & headbutting.
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Rank: Member Joined: 3/23/2011 Posts: 304
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http://www.businessdaily...em-2-n2jcb2z/index.html
40% of tax revenue for 2017 is set to debt repayment!!!!!....Loan uptake does not look like its slowing down any time soon You dont have to be great to START but you have to start to be GREAT!!!!!!!!
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