Rwanda says it placed its first bond, as part of its medium-term notes, in Japan’s samurai market as the country seeks to raise funds from the latter, officials said.
The Samurai Market is the largest debt capital market in Japan, and also considered the most demanding in terms of requirements and compliance issues.
The development was announced on Wednesday, November 23, after Prime Minister Edouard Ngirente received Japan’s outgoing Ambassador to Rwanda, Masahiro Imai.
The meeting, which was also attended by various government officials, sparked discussions around the achievements of the “long bilateral relationship” and areas of ongoing cooperation between Rwanda and Japan.
Weighing in on the talks, Minister of State for the East African Community (EAC), Manasseh Nshuti, confirmed the bond issuance, citing that negotiations are ongoing and talks could be completed by next year.
Minister Nshuti did not give details regarding the target value, maturity period and interest rates, citing that the parties involved negotiate the best reasonable outcome.
The funds, he said, would be invested in key sectors identified by the government.
It is not the first time that Rwanda has raised funds in the international debt market, but Nshuti says it is the most attractive because of “very low interest rates”.
In August last year, Rwanda raised $620 million in its second Eurobond, with an interest rate of 5.5% and a 10-year maturity.
“The yen bond remains with an ultra-low interest rate. The country’s assumed interest rate currently stands at 1.3% for debt service, but may even go lower than that in some cases,” Nshuti said.
According to experts, this development comes at a time when bond markets have seen a dramatic change in 2022. After bond yields fell earlier, they reversed course and started to rise again in August.
“The success of the bid can also be taken as a sign that Japanese investors’ confidence in our (Rwandan) fiscal stability and economic fundamentals is growing rapidly,” Nshuti added. “It is part of what we discussed and the envoy pledged to help us achieve this development.”
Cordial relations
Meanwhile, Rwanda and Japan have enjoyed 60 years of fruitful bilateral relations, particularly in the areas of climate change mitigation, infrastructure development and public-private investment.
We talked about our past 60 years of collaboration between Rwanda and Japan, especially through JICA, especially in the sector of agriculture, education, ICT and innovation, the Rwanda Space Agency (RSA), among others.
“But we also talked about an additional collaboration in which we must join forces, namely collaboration for economic development in the fields of health care and high technology,” Ambassador Imai said.
Asked about his tenure, he pointed out: “It has been a very difficult time because of the pandemic, but for a person like me who worked at the Private Sector Federation (PSF), for more than 40 years in Japan, this was an honor and an irreplaceable experience to work for better relations between the two countries.”
“I think I may have identified areas where we need to do more,” Imai reiterated.
Rwanda says it placed its first bond, as part of its medium-term notes, in Japan’s samurai market as the country seeks to raise funds from the latter, officials said.
The Samurai Market is the largest debt capital market in Japan, and also considered the most demanding in terms of requirements and compliance issues.
The development was announced on Wednesday, November 23, after Prime Minister Edouard Ngirente received Japan’s outgoing Ambassador to Rwanda, Masahiro Imai.
The meeting, which was also attended by various government officials, sparked discussions around the achievements of the “long bilateral relationship” and areas of ongoing cooperation between Rwanda and Japan.
Weighing in on the talks, Minister of State for the East African Community (EAC), Manasseh Nshuti, confirmed the bond issuance, citing that negotiations are ongoing and talks could be completed by next year.
Minister Nshuti did not give details regarding the target value, maturity period and interest rates, citing that the parties involved negotiate the best reasonable outcome.
The funds, he said, would be invested in key sectors identified by the government.
It is not the first time that Rwanda has raised funds in the international debt market, but Nshuti says it is the most attractive because of “very low interest rates”.
In August last year, Rwanda raised $620 million in its second Eurobond, with an interest rate of 5.5% and a 10-year maturity.
“The yen bond remains with an ultra-low interest rate. The country’s assumed interest rate currently stands at 1.3% for debt service, but may even go lower than that in some cases,” Nshuti said.
According to experts, this development comes at a time when bond markets have seen a dramatic change in 2022. After bond yields fell earlier, they reversed course and started to rise again in August.
“The success of the bid can also be taken as a sign that Japanese investors’ confidence in our (Rwandan) fiscal stability and economic fundamentals is growing rapidly,” Nshuti added. “It is part of what we discussed and the envoy pledged to help us achieve this development.”
Cordial relations
Meanwhile, Rwanda and Japan have enjoyed 60 years of fruitful bilateral relations, particularly in the areas of climate change mitigation, infrastructure development and public-private investment.
We talked about our past 60 years of collaboration between Rwanda and Japan, especially through JICA, especially in the sector of agriculture, education, ICT and innovation, the Rwanda Space Agency (RSA), among others.
“But we also talked about an additional collaboration in which we must join forces, namely collaboration for economic development in the fields of health care and high technology,” Ambassador Imai said.
Asked about his tenure, he pointed out: “It has been a very difficult time because of the pandemic, but for a person like me who worked at the Private Sector Federation (PSF), for more than 40 years in Japan, this was an honor and an irreplaceable experience to work for better relations between the two countries.”
“I think I may have identified areas where we need to do more,” Imai reiterated.