(NAIROBI, KENYA) – Kenya is moving to borrow KES 38.74 billion ($300.1 million / £237.4 million / €276.9 million) against future betting tax collections to complete 33 stadium projects across the country.
The Sports, Arts and Social Development Fund (SASDF) has started looking for a transaction advisor and lead arranger for the loan, which is set to run for 15 years. This will be the second time the fund has raised money against its future income, after the KES 44.8 billion ($347.1 million / £274.6 million / €320.2 million) Talanta bond that is paying for the 60,000 seat Raila Odinga Stadium in Nairobi.
The fund said the money being sought matches the contract price for the 33 new and ongoing stadium works and related infrastructure. It wants the financing closed within 60 days of awarding the mandate.
The advisors will be expected to find lenders or investors, agree financing terms, build financial models, and ensure the projects remain viable throughout the loan period.
Stadium projects are underway in Mombasa, Kisumu, Nakuru, Eldoret and more than 20 other counties. The government is also upgrading Kasarani and Nyayo National Stadiums in Nairobi ahead of the Africa Cup of Nations tournament in June 2027, which Kenya is co-hosting with Tanzania and Uganda.
Under the financing plan, money collected by the fund is used to repay interest and principal to lenders, allowing the government to borrow against future taxes.
The fund mainly receives taxes and levies from the betting industry, with a monthly target of KES 2.07 billion ($16 million / £12.7 million / €14.8 million). In the year to June 2026, betting taxes rose 24.9% to KES 16.5 billion ($127.9 million / £101.1 million / €117.9 million), against a target of KES 14.26 billion ($110.5 million / £87.4 million / €101.9 million).
Total funding for SASDF in the 2026/2027 budget was set at KES 25.2 billion ($195.3 million / £154.4 million / €180.1 million), within a wider allocation of KES 45 billion ($348.8 million / £275.8 million / €321.6 million) to the Sports and Tourism Ministry. The Tourism Fund was allocated KES 14.3 billion ($110.8 million / £87.6 million / €102.2 million).
Kenya has turned to securitising future taxes and levies to pay for large public projects as its borrowing room shrinks. Public debt now stands at KES 13 trillion ($100.8 billion / £79.7 billion / €92.9 billion).
The government is also pursuing public private partnerships across energy, transport, water, housing, health and digital infrastructure. It is targeting at least KES 70 billion ($542.6 million / £429 million / €500.4 million) in PPP investments this year.
Last year, the Treasury securitised KES 7 out of the KES 25 per litre collected under the Road Maintenance Levy Fund to service KES 175 billion ($1.36 billion / £1.07 billion / €1.25 billion) in loans used to clear pending bills owed to road contractors.
The government plans to use a further KES 5 per litre from that levy to back a new KES 125 billion ($968.9 million / £766.1 million / €893.6 million) roads bond. The levy was raised from KES 18 to KES 25 per litre in July 2024.
The Tourism ministry is also using part of the KES 5 billion ($38.8 million / £30.6 million / €35.7 million) annual Tourism Levy to repay private investors in hotels and commercial facilities for the ongoing KES 31 billion ($240.3 million / £190 million / €221.6 million) Bomas International Convention Complex development.
The Tourism Levy is charged at 2% of gross receipts from monthly sales of food, drinks, accommodation and other services in regulated hotels, restaurants and tourism activities.
Kenya is also planning to take up to 90% of annual revenues from the Railway Development Levy to secure funding for extending the standard gauge railway from Naivasha to Malaba.
On the sports fund, the government wants to use the borrowing headroom left after servicing the Talanta bond to take on more debt. This year, the fund will spend KES 6.5 billion ($50.4 million / £39.8 million / €46.5 million) on Talanta bond repayments. A disbursement of KES 3.25 billion ($25.2 million / £19.9 million / €23.2 million) was made on 7th July, with a second payment of the same amount due on 7th January 2027.
The 15 year Talanta bond was issued in July 2025 by Liaison Group through a special vehicle known as Linzi FinCo 003 Trust. It carries a 15.04% return, which will earn investors KES 57.6 billion ($446.5 million / £353 million / €411.8 million) in interest over the life of the debt. The interest income is exempt from withholding tax, giving the bond the same status as government issued infrastructure bonds.
The bond is amortised, meaning its principal will be paid down in equal annual instalments of about KES 2.98 billion ($23.1 million / £18.3 million / €21.3 million), reducing the interest expense over time.