Kenya’s National Treasury is set to absorb and restructure Kenya Airways’ (KQ) debt to facilitate a $1.5bn investor-led turnaround plan.This move aims to clear financial hurdles and attract a consortium of strategic equity investors, marking a critical step in revitalizing the struggling national carrier.The decision comes amid ongoing efforts to stabilize KQ’s operations, which have faced chronic financial challenges.

By taking on fresh debt, the Treasury hopes to create a conducive environment for equity investments, ensuring the airline can meet its operational and financial obligations.The plan underscores the government’s commitment to supporting key sectors while balancing fiscal responsibility.

Analysts note that this restructuring could position KQ to compete more effectively in regional and international markets, though challenges remain in ensuring long-term sustainability.

The initiative also highlights Kenya’s broader economic strategy to attract foreign capital and revitalize infrastructure, aligning with national development goals.