Cabinet approves Ksh.45 billion lifeline for Kenya Airways turnaround

The Cabinet has approved USD 350 million (approximately Ksh.45 billion) in shareholder financing for Kenya Airways to help the national carrier meet urgent financial obligations, fund aircraft maintenance and return grounded planes to service.

The funds will be disbursed in tranches under the oversight of the National Treasury, with a repayment period of up to 10 years and the possibility of conversion into equity, subject to the necessary approvals.

In a statement issued after a Cabinet meeting at State House, Nairobi, on Friday, October 9, 2026, the government said the financing was part of measures to support the airline's long-term turnaround plan.

The Cabinet also endorsed the proposed conversion of Ksh.122 billion in existing government loans, plus accrued interest, into an equity-qualifying tradable instrument to strengthen Kenya Airways' balance sheet and support future capital raising.

The implementation of the measures remains subject to the necessary corporate, shareholder and regulatory approvals.

The government said Kenya Airways contributes more than USD1.3 billion annually to Kenya's Gross Domestic Product through tourism, trade and regional connectivity.

The latest measures are intended to support the airline's financial position and safeguard its contribution to the country's economy.