Kenya is set to become the first African nation to issue Sustainable Linked Bonds (SLBs) by the end of 2024, with the support of the World Bank, Bloomberg reported yesterday, citing an expert from the multilateral financial institution.
The sustainable development bonds, totaling $500 million, are expected to be issued by November. “Kenya has promised a very ambitious sustainability agenda, which includes not just climate, but also social and health and energy," said Isfandyar Zaman Khan, Senior Financial Sector Specialist at the World Bank's Kenya office. He stressed that the proceeds from these bonds will finance the state budget, making Kenya the pioneer in Africa for such issuance.
East Africa's largest economy is actively seeking new sources of financing to cover its budget deficit, projected to reach 3.9% of GDP in the 2024/2025 fiscal year (July-June). Sustainable Linked Bonds are debt securities aimed at encouraging companies or sovereign issuers to contribute to sustainability from an Environmental, Social, and Governance (ESG) perspective. Issuers explicitly commit, including in bond documentation, to future improvements in their sustainability performance, according to predefined timelines. These goals are measured using Key Performance Indicators (KPIs).
Unlike Sustainability Bonds, where the issuer commits to allocate the proceeds to finance environmental or social projects, the proceeds from Sustainable Linked Bonds are intended for general purposes. Kenya's issuance of these bonds is expected to be guaranteed by the World Bank, reducing risk for investors and lowering the cost of these debt securities.
“The World Bank will assist Kenya in developing the sustainability-linked framework and key performance indicators for the bond,” Khan said. The way these indicators are modeled is to reward Kenya when it achieves something beyond what it would have done in normal circumstances, he noted, indicating that the Democratic Republic of Congo and Angola are also considering issuing such bonds.
Lebara Group is now bringing its affordable and reliable mobile services to Africa, starting with Ni...
Transport and food prices have been climbing steadily across Africa in recent years. In Côte d’Ivoir...
• BOAD releases CFA10 billion ($17.8 million) to support Boungou and Wahgnion gold mines.• Burkina F...
In a West African financial landscape marked by tighter regulation of the fintech sector, digital fi...
• Maritime sector faces renewed risks amid military tensions in the Middle East• Blockade fears at S...
Gabon is targeting deepwater oil to offset declining output, now at 200,000 b/d Investor-friendly reforms and better data access are driving...
MTN Nigeria launched a 100 million naira startup accelerator starting September The 12-week program offers funding, mentorship, and tech...
Rebel violence cut Bisie tin mine’s Q2 output to 4,106 tonnes, 21% below target H1 production hit 8,376 tonnes, 47% of Alphamin’s 2025...
Egypt opened Africa’s largest wind farm, raising Gulf of Suez capacity to 912.5 MW. Pro-investor policies have driven Egypt’s 340% renewable energy...
The Gerewol tradition is a fascinating ritual celebrated by the Bororo Fulani, a nomadic community primarily located in Chad and Niger. This annual...
In northern Ethiopia, in the Tigray region, lies Axum (also spelled Aksum), an ancient city that once stood at the heart of one of Africa’s most powerful...