Kenya’s Foreign Exchange Reserves Hit Record High After Safaricom Deal and World Bank Funding

Kenya’s foreign exchange reserves have reached a historic high. The reserves rose by $1.5 billion in a week, strengthening the country’s ability to meet external obligations and support currency stability.

The Central Bank of Kenya (CBK) reported that the country’s foreign exchange reserves increased to a record $15.4 billion (Sh1.99 trillion), up from $13.9 billion recorded on July 23. The reserves now cover 6.4 months of imports, surpassing both the CBK’s minimum requirement of four months and the East African Community benchmark of 4.5 months.

The sharp increase was largely driven by proceeds from the government’s sale of a 15 percent stake in Safaricom to South Africa’s Vodacom, which brought in $1.86 billion. Kenya also received $750 million in budget support from the World Bank, further boosting the reserve position.

Vodacom paid Sh204 billion for the Safaricom shares through a block trade on the Nairobi Securities Exchange, raising its effective stake in the telecommunications firm to 55 percent while reducing the Kenyan government’s holding to 20 percent.

An upfront dividend arrangement increased the overall transaction package to approximately Sh240.5 billion.

The World Bank funding was disbursed through a Development Policy Operation aimed at supporting reforms in public financial management, governance and social protection. Despite the substantial inflows, a Sh144 billion difference between total receipts and the weekly reserve increase points to significant foreign currency outflows, although the CBK did not disclose how much was used for debt servicing.

The latest reserve gains add to previous support from Eurobond proceeds, diaspora remittances, tourism earnings and other foreign inflows. However, the CBK recently revised its 2026 remittance forecast downward by $313 million to $5.1 billion, citing weaker expected inflows from Gulf countries and slower growth in other key markets.