Kenyans in the Diaspora will soon have an opportunity to invest back home through an innovative dollar bond, Prime Cabinet Secretary Musalia Mudavadi has announced.
In a statement on Sunday, February 4, Mudavadi said the dollar bond will be structured by the World Bank’s Multilateral Investment Guarantee Agency (MIGA) and the National Treasury.
His announcement came following discussions with MIGA’s Executive Vice President, Hiroshi Matano during his concluded trip to the United States.
The bond, the statement explains, will target the millions of monies saved by Kenyans abroad and will offer better returns compared to the interest rates offered by banks.
According to MIGA, the amount of money saved by Kenyans abroad every year could be in the region of $4 billion, equal to the annual remittances sent to Kenya.
Besides, the bonds will reduce the government’s reliance on borrowing, offering a much-needed alternative to commercial debt.
“We are working on a secure bond that will offer better returns than interest rates in the source markets for our Diaspora remittances,” Mudavadi said.
“The bond will enable the Government to diversify its public debt mix, reducing our exposure to costly commercial debt.”
At the same time, Mudavadi wooed investors to support the Bottom-up Economic Transformation Agenda (BETA).
Mudavadi Asks Investors to Support Bottom up Projects
Among the investors he met was Scott Nathan, CEO of the Development Finance Corporation (DFC), where he urged the organization to support the government’s economic and social transformation agenda.
In his meeting, Mudavadi asked DFC for investments in infrastructure, manufacturing and supply chain diversification noting that they would unlock Kenya’s potential as a regional logistics hub for the United Nations operations and global investors in the Eastern Africa region.
The US development finance institution provides finance and investment guarantees, is also working with the National Treasury on climate friendly initiatives including smart agriculture, clean energy and electric vehicles.
In addition, the Prime CS met Chidi Blyden, the Deputy Chief Executive Officer of the Millennium Challenge Corporation (MCC).
Their meeting focused on the implementation of several infrastructure projects in Nairobi including the Bus Rapid Transit (BRT) network and bicycle lanes.
The MCC also committed to help in developing pedestrian pathways, crossways and overpasses on major roads in the city.
It will also facilitate connectivity of matatu stops to the emerging commuter rail network and promote the mobility of women in urban areas.
Once completed, the project is expected to help reduce commuter time and promote economic growth in the region.