Published: May 5, 2013
Government raises US$400mn for national carrier refinancing and project financings.
Rwanda has issued its debut international sovereign bond, raising US$400mn.
The deal, run by Citi and BNP Paribas, attracted more than 250 investors and closed with an order book worth more than US$3.5bn, according to a statement from Rwanda's ministry of finance. The 10-year bond was priced with a coupon of 6.625%.
The proceeds will be used to fund a variety of projects. Some US$80mn will refinance debt for RwandAir, the national airline; US$120mn will repay debt for the Kigali Convention Center, with a further US$150mn paying for its construction; and US$50mn will be used to construct a 28MW hydro-electric dam.
Rwanda's minister of finance and economic planning, Claver Gatete, responded to questions over why the government had not issued a benchmark transaction of more than US$500mn by noting: “Rwanda entered the market to finance specific projects that will impact positively our economy and we value debt sustainability over the medium to long term. We remain open to returning to international debt markets once we will have additional projects that qualify.”
Analysts at ratings agency Fitch say the bond will "enhance the country's external debt profile, support GDP growth and help attract investment".