Kenya investors undeterred by ICC trials

2013-09-17 10:18
Kenya's new president Uhuru Kenyatta. (File, AFP)

Kenya's new president Uhuru Kenyatta. (File, AFP)

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

Nairobi - Kenya's economic prospects look more favourable and foreign investors seem undeterred by a trial of Kenyan president and his deputy on charges of crimes against humanity in The Hague, a senior IMF official said on Monday.

Kenya's situation had improved from three years ago, when it faced the impact of two consecutive droughts and the fallout from the global financial crisis, that cause a sharp economic slowdown.

It was also coming to the end of an IMF Extended Credit Facility programme that had provided $700m over three years.

With growth running at 5.5% this year, International Monetary Fund Africa director Antoinette Sayeh said Kenya was in a "good place" to issue a debut Eurobond, which the government says could raise up to $2bn later this year.

Kenya has long wanted a Eurobond issue but initial plans to raise $500m were shelved after nationwide violence in early 2008 following a disputed election that stunted economic growth and later because of the global financial crisis.

Politics in Kenya has been overshadowed by the trials of Deputy President William Ruto's, which began last week, and President Uhuru Kenyatta, starting in November, raising fears that business confidence could be hurt by the uncertainty.

Both men, who won an election on a joint ticket in March, are being tried on charges of orchestrating violence after a vote more than five years go when they were in rival camps. They deny the charges and have pledged to co-operate with the court.

"Investors are very gung-ho on Kenya these days," Sayeh told reporters in Nairobi, when asked about the impact of the cases.

Good economic prospects

"Everybody is aware that there is a trial going on, yet they are certainly continuing to see that Kenya has very good economic prospects," she said.

Inflation was close to the government's 5% target, she noted, and Kenya's external position had improved.

Another IMF official said the current account deficit in 2012/13 had narrowed to 8.9% of gross domestic product, from 9.4% a year earlier, but said it would have recorded a small surplus and shown a bigger improvement when costly imports of energy industry equipment were stripped out.

Such imports have grown with the exploration and discovery of oil in Kenya, east Africa's biggest economy.

To fund infrastructure and retire more expensive debt, Kenya is choosing advisers for a Eurobond, expected later this year.

Analysts say borrowing costs for emerging markets could rise with any US move to scale back bond purchases, or quantitative easing, drawing investors to higher yields in advanced economies.

"We don't see a major risk of large outflows from Kenya that it will not be able to sustain," Sayeh said, adding Kenya had a flexible exchange rate to deal with any potential outflows.

Read more on:    imf  |  uhuru kenyatta  |  wiliam ruto  |  kenya  |  east africa

Join the conversation! encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.
NEXT ON NEWS24X publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24


Book flights

Compare, Book, Fly

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.