In a surprise move, Kenya initiated the process to buy back its $2 billion Eurobonds maturing in June, capitalizing on a significant drop in yields.

This comes after months of speculation and a previous hesitation on the plan announced by President William Ruto in December.

"The Republic of Kenya today invites eligible holders of its outstanding 2 billion dollars 6.87 percent notes due 2024 for repurchase," the government declared in a statement.

The offer, open for one week until February 14th, aims to leverage the current favourable debt environment.

Governor of the Central Bank of Kenya (CBK), Kamau Thugge, had previously hinted at this opportunity, citing positive global conditions.

"There is a window for Kenya to return to markets and refinance the Eurobond maturity," he stated.

Successful issuances by Cote D'Ivoire and Benin demonstrated the feasibility of this approach.

This proactive move eases concerns surrounding Kenya's ability to repay the debt, especially considering recent struggles with inflation and forex reserve decline.

On Tuesday, the CBK raised its benchmark rate to 13 per cent - the highest since 2012 - to combat inflation and stabilize the shilling.

These Eurobonds, issued in 2014, represent Kenya's largest external debt and marked their entry into the commercial debt arena for budget financing.

By repurchasing the bonds now at lower yields, Kenya stands to save significantly on interest payments, freeing up resources for other crucial endeavours.

This bold action signals the government's commitment to fiscal responsibility and debt management.

Whether the offer resonates with investors and successfully concludes the buyback remains to be seen.

However, Kenya's proactive approach amidst challenging economic circumstances deserves recognition.