Kisumu is laying the groundwork to issue a county bond that will raise at least Sh1 billion, governor Anyang Nyong’o has said.
Prof Nyong’o told the Business Daily the county is also lining up possible projects for funding through the public-private partnership (PPP) model ahead of making a pitch to investors.
Kisumu is set to hold a four-day investment conference in Kisumu from December 19 to 22 bringing together local and international investors to showcase and promote investment opportunities in the county.
Kisumu is among three counties alongside Makueni and Bungoma that were adjudged fit to borrow through the Nairobi Securities Exchange and external markets by the South Africa-based Global Credit Rating Company (GCR) last year.
“We wanted, first of all, to set our house in order. These issues that were raised by the credit rating agency, are the things we are sorting out,” said Prof Nyong’o.
“We will do that (capital raising) after the investment conference. Our credit rating is now good. Our economic fundamentals are okay, so (it shall be) after the investment conference when we know how many people want to go with us to PPP or the kind of opportunities we want to invest in as a county.”
The governor, who spoke during the Kisumu Investment Forum and Expo held in Nairobi to promote the upcoming investment conference, said the county would issue such a bond through its parastatal, the Lake Front Development Corporation.
It would follow the lead of Laikipia County, which recently inched closer to becoming the first county to issue an infrastructure bond targeting Sh1.16 billion.
“Our case will be easier because we have a parastatal that can float such a bond. We are not going to target less than a billion,” said Prof Nyong’o.
The Constitution allows counties to borrow from the capital markets and foreign sources once cleared by the National Treasury. The law requires the Treasury to guarantee devolved units to raise cash from investors upon meeting stringent conditions.