From Reuters

Kenya wants to double the government’s external debt ceiling to $28 billion, to finance infrastructure projects, including a new railway, port, roads and power supply, the finance ministry has said.

With that in mind, Kenya plans to borrow up to $750 million by re-opening its international bond issued in June to finance development projects, Treasury Secretary Henry Rotich said in a statement to parliament seen by Reuters on Wednesday.

He did not give details on the timing of the bond issue.

East Africa’s biggest economy raised $2 billion in its debut Eurobond issue in June, with the cash earmarked to support the budget and repay a $600 million syndicated loan.

Rotich’s statement also asked parliament to approve the increase of Kenya’s total foreign indebtedness to $28 billion from $14 billion. Approval was not guaranteed.

The statement said the requested debt ceiling was for planning purposes and the loans contracted would have to be scrutinised by parliament.

President Uhuru Kenyatta said in June the Eurobond would cut the government’s local borrowing, reducing interest rates. The central bank has kept its benchmark lending rate at 8.5 percent since May 2013.

Analysts say the downside to increasing the external debt ceiling is that the country will be more exposed to fluctuations in the exchange rates, and become more interlinked to vagaries of other international markets.

Read more at Reuters