The huge drop in forex reserves witnessed early this month is suspected to have been a result of interest payments on the country's second Eurobond, which was contracted on February 22, 2018. A further fall in forex reserves is expected as six months debt suspension plan by G20 countries and Paris Club expires in June, forcing Kenya to repay all external debts due. It is either Kenya returns to the international debt market to pay off loans due or draw from forex reserves,'' Achar said. There is a danger in depleting forex reserves. Internationally, a country is supposed to keep its forex reserve at least three- months of import cover.

Source: The Star March 16, 2021 00:56 UTC