Capital market financing for the Kenyan water sector
The Government of Kenya is exploring the possibility of introducing a domestic capital market financing (CMF) window for the water and sanitation (W&S) sector. This initiative would effectively allow pension funds to invest in the sector.
The challenge
The funding and financing gap in the water sector to achieve universal access remains a challenge for water service providers (WSPs) in Kenya. A variety of funding and financing sources, including commercial financing, will be required. The funding gap for NAWASIP is approximately KES 652 billion (EUR 4.5 billion) for the period from 2023 to 2030.
The approach
The aim of the project is to develop a roadmap that leads to capital market financing in the Kenyan water sector. The model being used is a pooled bond with a sufficient ticket size to justify the transaction costs.
There have been previous attempts to implement this concept. Rebel analyzed the model and identified barriers, as well as ways to overcome them.
Impact
The result of the project was an action plan that, if fully implemented, could make capital market financing for the water sector possible.
The experience of a Rebel
