THE NATIONAL TREASURY

Transcription

1 REPUBLIC OF KENYA THE NATIONAL TREASURY MONTHLY DEBT BULLETIN DECEMBER 2013

2 1.0 PUBLIC DEBT 1.1 Introduction As at nd Dcmbr 2013, public and publicly guarantd dbt stood at Kshs 2, billion or 50.7 prcnt of GDP (s Tabl 1). Th incras of 1.41 prcnt ovr th nd Novmbr 2013 position is mainly attributd to incras in domstic dbt. Gross domstic dbt incrasd by Ksh billion to stand at Ksh 1, billion, whil xtrnal dbt incrasd by Ksh billion to stand at Ksh billion in Dcmbr (S Tabl 1). Tabl 1: Siz of public dbt nd Dcmbr 2013, in billion Dbt Catgory Kshs Domstic Dbt 1, Extrnal Dbt Total 2, Sourc: Th National Trasury and Cntral Bank of Knya USD Th structur of public and publicly guarantd dbt shows that 56.6 prcnt of th total dbt is domstic dbt whil 43.4 prcnt is xtrnal dbt as shown in Chart 1. Chart 1: Composition of public dbt E xtrnal Dbt 43.4% Dom s tic Dbt % Sourc: Th National Trasury 1.2 Cost/Risk Charactristics of Public Dbt Rflcting Govrnmnt xtrnal dbt stratgy of contracting or guaranting xtrnal loans with highly concssional trms to minimis intrst rat cost, th avrag intrst rat and grac priod on th xtrnal dbt portfolio was 1.1 prcnt and 7.5 yars, rspctivly. In addition, th avrag maturity priod for xtrnal loans was 32.6 yars whil th avrag grant lmnt was 71.0 prcnt. As an indication of th succss in th lngthning of maturity structur of domstic dbt to minimis rfinancing risk in lin with th Mdium Trm Dbt Stratgy, th avrag maturity profil of outstanding Govrnmnt domstic dbt stood at 4 yars 11 month as at nd Dcmbr 2013 compard with 4 yar 11 months in Dcmbr Pag 1 of 14

3 1.3 Movmnt in Exchang Rats Tabl 2 shows markt indicativ nd-month forign xchang rats for th priod Octobr 2013 to Dcmbr During this priod, th Knya shilling dprciatd against th US Dollar, Strling Pound and Euro by 0.01, 0.04 and 0.02 prcnt rspctivly. Th shilling apprciatd against th Japans Yn by Th shilling stood at Kshs to th US Dollar at nd of Dcmbr Dprciation of th Knya Shilling has th ffct of incrasing xtrnal dbt stock and th cost of dbt srvic. Tabl 2: Movmnt in xchang rats C ur rncy U S D ollar STG Pound Euro JPY (100) Octobr Novmbr D cmbr Sourc: Cntra l Bank of Knya Chart 2 shows th trnds in daily xchang rats btwn Knya Shilling and th four major forign currncis from Octobr 2013 to Dcmbr Th xchang rat against th four major currncis showd mixd movmnts during th month of Dcmbr Chart 2: Knya Shilling Exchang Rat E x c h a n g GBP EURO R a t s JPY, USD Sourc: Cntral Bank of Knya Pag 2 of 14

4 2.0 EXTERNAL DEBT 2.1 Siz of Public and Publicly Guarantd Extrnal Dbt Ovrall, public and publicly guarantd xtrnal dbt incrasd by Kshs billion as at nd Dcmbr 2013 to Kshs billion from Kshs billion as shown in Tabl 3. Tabl 3: Extrnal dbt stock, in billions Novmbr 2013 Dcmbr 2013 Kshs USD Kshs USD Bilatral Multilatral Guarantd Othrs Commrcial Banks Total Sourc: Th National Trasury This incras is attributd to disbursmnts from IDA, Franc and China. Chart 3 blow indicats th currncy composition of xtrnal dbt, it shows that th Euro forms th largst shar of th xtrnal dbt portfolio at 34.7 prcnt followd by th US Dollar at 28.1 prcnt. Chart 3. Currncy Composition J a p a n s Y n % Eu ro % P o un d Strling 5.8 % U.S. D o lla r % Sourc: Th National Trasury Y u a n 6.8 % O th rs % 2.2 Structur of Extrnal Dbt by Crditor Official crditors account for prcnt of th total public and publicly guarantd xtrnal dbt, out of which dbts owd to multilatral crditors amounts to Ksh billion (including Ksh 3.88 billion guarantd dbt owd to IDA) dominat th portfolio (61.00 prcnt of th total). Bilatral dbt stands at Kshs billion (30.88 prcnt of th total), inclusiv of Kshs billion guarantd dbt, as shown in Chart 4 and Annx 1. In th multilatral catgory, IDA, ADB/ADF, IMF and EEC/EIB account for th largst proportion of xtrnal crdit, whil Japan, China and Franc ar th lading crditors in th bilatral catgory. Th Commrcial dbt constituts 6.41 prcnt of th total public and publicly guarantd xtrnal dbt. Pag 3 of 14

5 Chart 4: Extrnal Dbt by Crditor P r c n t a g Sp Oct-13 Bilatral Multilatral Nov-13 Othrs Dc-13 Commrcial Banks Sourc: Th National 2.3 Extrnal Dbt by Sctor Chart 5 blow illustrats how th outstanding xtrnal dbt is shard among th conomic and social sctors of th conomy. Chart 5: Extrnal Dbt Shar by Sctors D I S B U R S E D O U T S T A N D I N G D E B T HEA L TH E D UC A TIO N A GRIC -5.0 ENERGY, INFRA & IC T G n ral Ec o n om ic C o mm r cial L ab o u r A ffairs P UBL IC ENVIRO NM ENTA L A D M INISTRA TIO N & P RO TEC TIO N, W A TER INTERNA TIO NA L A ND HO USING REL A TIO NS Pag 4 of 14

6 2.4 Projctd Cumulativ Extrnal Dbt Srvic Projctd cumulativ xtrnal dbt srvic for th priod to nd Dcmbr 2013 stood at Kshs billion. Principal and intrst projctions for th month of Dcmbr 2013 was Kshs 3.36 billion and Kshs 1.08 billion, rspctivly. Multilatral and bilatral crditors constitut 42.8 prcnt and 53.4 prcnt of th cumulativ projctd dbt srvic rspctivly during th priod undr rviw as shown in Tabl 4. Tabl 4: Projctd Cummulativ Extrnal Dbt Srvic as at nd of Dcmbr 2013, in Kshs million Crditor catgory Principal Intrst Total Bilatral 9, , , Multilatral 7, , , Commrcial Total 16, , , Sourc: Th National Trasury 2.5 Actual Cumulativ Extrnal Dbt Srvic Actual cumulativ dbt srvic as at nd Dcmbr 2013 was Kshs billion as shown in Tabl 5. Actual principal and intrst paymnts for th month of Dcmbr 2013 was Kshs 2.88 billion and Kshs 0.73 billion rspctivly. Tabl 5: Actual cumulativ xtrnal dbt srvic as at nd of Dcmbr 2013, in Kshs million Crdit catgory Principal Intrst Total Bilatral 5, , , Multilatrals 6, , , Commrcials , , Totals 12, , , Sourc: Th National Trasury 2.6 Budgt Dviation Th actual cumulativ dbt srvic for Dcmbr 2013 was blow th projctd dbt srvic by Kshs 3.5 billion and this is attributd to th xchang rat diffrnc in th projctd and actual dbt srvic. Pag 5 of 14

7 2.7 Guarantd Extrnal Dbt Undr th Public Financial Managmnt Act, 2012, th govrnmnt may issu guarants so long as it dos not xcd th statutory ciling st by Parliamnt which currntly stands at Kshs 200 billion. Th guarantd xtrnal dbt dcrasd by Kshs 1.69 billion to Kshs billion in Dcmbr 2013 from Ksh billion in Novmbr 2013 du to rpaymnts during th month. Tabl 6: Guarantd outstanding dbt by crditor, in Kshs million Crditor Octobr 2013 Novmbr 2013 Dcmbr 2013 Japan 41, , , Canada U.S.A IDA (KR Concssionair) 3, , , Totals 45, , , Sourc: Th National Trasury Pag 6 of 14

8 3.0 DOMESTIC DEBT 3.1 Cntral Govrnmnt Domstic Dbt Govrnmnt nt domstic dbt dcrasd by Kshs billion to Kshs billion in Dcmbr 2013 from Kshs billion in Novmbr 2013 du to incras in Govrnmnt dposits ovr th priod as indicatd in Tabl 7. Tabl 7: Govrnmnt domstic dbt, in Kshs billion Octobr 2013 Novmbr 2013 Dcmbr 2013 Gross domstic dbt 1, , , lss Govt. dposits at CBK Govt. dposits at commrcial banks Govt. advancs to parastatals Nt domstic dbt Sourc: Cntral Bank of Knya Govrnmnt Domstic Borrowing During th month of Dcmbr 2013, Govrnmnt scuritis worth Kshs 58 billion wr advrtisd. Bids worth Kshs billion and billion wr rcivd for Trasury Bills and Trasury Bond rspctivly during th month.succssful bids amountd to Kshs billion against th months rdmptions of Kshs billion laving xchqur with a surplus of Kshs billion. Tabl 8: Govrnmnt domstic borrowing, in Kshs million Trasury Bills Trasury Bonds Total Advrtisd 43,000 15,000 58,000 Bids rcivd 36,698 30,686 67,384 Succssful bids 33,422 25,252 58,674 (36,624) (2,262) (38,886) (3,202) 22,990 19,788 Rdmptions (cost) Nt domstic borrowing Sourc: Th National Trasury Pag 7 of 14

9 Tabl 9: Domstic dbt instrumnts by holdr, in Kshs billion Commrcial banks Non banks Cntral Bank of Knya Non rsidnts Total Trasury bonds Trasury bills Othrs Total , Instrumnt/Holdr Prcntag Holding Sourc: Cntral Bank of Knya At th nd of Dcmbr 2013, commrcial banks continud to hold th largst proportion of th outstanding Govrnmnt dbt scuritis amounting to Kshs billion or 47.3 prcnt as shown in Tabl 9 and Chart 6. Th non banks hld 46.4 prcnt of th outstanding Govrnmnt papr, mostly Trasury Bonds. Th non banks catgory compriss non bank financial institutions, National Social Scurity Fund (NSSF), parastatals, insuranc companis, building socitis, pnsion funds and individuals. Govrnmnt dbt worth Kshs billion or 0.9 prcnt was hld by non rsidnts who invst through nomin accounts in th local banks. Kshs billion hld by Cntral Bank of Knya compriss th Govrnmnt ovrdraft and Rpo Trasury Bills usd for xcution of montary policy. Chart 6: Domstic dbt by holdr as at nd Dcmbr 2013 N o n r s i d n ts 0.9 % C n tr a l B a n k o f K n y a 5.4 % N on ba nks C o m m rci a l b a n k s % Sourc: Cntral Bank of Knya Pag 8 of 14

10 3.3 Domstic Dbt by Instrumnts Chart 7 shows th composition of th domstic dbt as at nd Novmbr prcnt of Govrnmnt domstic dbt was in Trasury Bonds, 25.8 prcnt in Trasury Bills whil th balanc is mainly th Govrnmnt ovrdraft at th Cntral Bank of Knya. Th structur of th holding is consistnt with th dbt stratgy of holding mor domstic dbt on longr datd instrumnts to minimis rfinancing risk and promot dvlopmnt of domstic markts for Govrmnt scuritis. Chart 7: Domstic dbt by instrumnt % 60.00% P r o p o r t i o n 50.00% 40.00% % ( 20.00% )% % 0.00% Trasury Bond Trasury Bill Othrs Sourc: Cntral Bank of Knya Pag 9 of 14

11 3.4 Nt Domstic Financing Tabl 10 shows that as at nd Dcmbr 2013, th nt domstic financing stood at Kshs billion. Tabl 10: Nt domstic financing, in Kshs billion Trasury Bills Trasury Bonds Pr-1997 Govt. Ovrdraft dbt Othr of which Ovrdraft (from CBK) Govt. dposits Nt Domstic Crdit Jun-2013 Dcmbr Chang Sourc: Cntral Bank of Knya 3.5 Cumulativ Domstic Intrst Paymnts As at nd Dcmbr 2013, Govrnmnt actual cumulativ domstic intrst paymnts stood at Kshs billion against th cumulativ projctd intrst paymnts of Kshs billion. Actual intrst paymnts on Trasury Bonds and Trasury Bills amountd to Kshs 47.1 billion and Kshs 8.76 billion rspctivly. Th varianc of Kshs 3.2 billion btwn actual and budgtd intrst paymnts is attributtd to intrst paymnts on Trasury bonds. Tabl 11: Domstic intrst paymnts, in Kshs million Typ of dbt Trasury bonds Trasury bills Ovrdraft Pr-1997 ovrdraft dbt Totals Projctd 43, , , Actual 47, , , Varianc 3, (410.50) , Sourc: Cntral Bank of Knya Pag 10 of 14

12 3.6 Avrag Intrst rats for Trasury Bills Chart 8 shows th monthly trnds on avrag intrst rats for both th 91-day and 182-day Trasury Bills sinc Dcmbr During th month of Dcmbr 2013, th avrag intrst rats for th 91-day Trasury bills dcrasd by 41 basis points to 9.53 prcnt from 9.94 prcnt in Novmbr 2013 and th 182days Trasury bill dcrasd by 14 basis points from pr cnt to prcnt pr annum. 364-days Trasury bill rat stood at an avrag of prcnt pr annum in Dcmbr Chart 8: Avrag intrst rats on Trasury Bills d a y s T r a s u r y b il l d a y s T r a s u r y b ill I n t r s t R a t P r io d Sourc: Cntral Bank of Knya 3.7 Yilds on Trasury Bonds Th Govrnmnt has bn implmnting a Bnchmark Bond programm to incras liquidity around slctd Bonds and promot scondary trading. On of th ky objctivs of th programm is to lowr both rfinancing risk and cost of borrowing by th Govrmnt. Tabl 12 shows th yilds on slctd bnchmark Trasury Bonds in th scondary markt as at nd Dcmbr Tabl 12 :Yilds on slctd Trasury Bonds Tnur 2 YR 5 YR 10 YR 15 YR 20 YR 25 YR Rat (%) Sourc: Nairobi Scuritis Exc hang (NSE) Pag 11 of 14

13 Chart 9: Scondary Markt yilds on slctd Trasury Bonds 14.00% R 13.00% a t s % 12.00% 11.00% 2YR 5YR 10YR 15 YR 20YR 25 YR Tnur Pag 12 of 14

14 ANNEX 1: STOCK OF PUBLIC AND PUBLICLY GUARANTEED EXTERNAL DEBT BY SOURCE (IN KSHS MILLIONS) CREDITOR Stock at nd Novmbr 2013 Stock at nd Dcmbr 2013 Chang CENTRAL GOVERNMENT BILATERAL AUS TRIA (48.06) BELGIUM 7, , (299.90) C ANADA 1, (66.34) DENMARK 2, , (26.84) (7.05) FR ANCE 56, , , GERMANY 26, , (169.36) I TALY 1, , (6.00) JAP AN 45, , (1,858.79) NETHERLANDS 2, , (118.83) UK 1, , (120.16) USA 4, , (129.55) FINLAND PARIS CLUB OTHERS NON PARIS CLUB o/w CHINA Sub total 5, , , , , , , , , , , ADB/AFDB 94, , , EEC/EIB 16, , (131.40) 344, , (573.72) 9, , (101.83) 74, , , MULTILATERAL IDA IFAD IMF OTHERS Sub total COMMERCIAL B ANKS SUPPLIE RS CREDIT Sub Tot al 9, , (45.40) 549, , , , , (363.43) 15, , , , , (11.44) 40, , (1,650.06) (0.88) 3, , (30.75) 45, , (1,693.13) 912, , , GUARANTEED DE BT CANADA JAPAN USA IDA ( KR C oncssionair) Sub Tot al GOK+ GUARANTEED TOTAL Sourc : Th National Tr asury Mmorandum itm Nominal GDP (in Kshs Billion) Sourc: QEBR Jun ,164.56

15 Information in this publication may b rproducd without rstriction provid d that du acknowldgmnt of th so urc is mad. Enquiris covring th publication should b addrssd to: Th Dirctor, Dbt Managmnt Dpartmnt, Na tional Trasury 1st Floor, Trasury Building, Haramb Avnu P.O Box , Nairo bi, Knya Tl: (25 4) Fax: (254) dmd@trasury.go.k Pag 14 of 14