NAIROBI (Reuters) – Kenya has sent out invitations to international commercial banks to subscribe to a syndicated loan worth up to 150 billion shillings ($1.45 billion), the Business Daily reported on Wednesday.

The finance ministry set a budget deficit of 5.6% of GDP in June for the 2019/20 (July-June) fiscal year, targeting to borrow 324 billion shillings or close to half of the shortfall, from external sources.

The loan, which will mature in six years, will come with an interest rate of 645 basis points above the Libor interest rate benchmark, the newspaper reported.

Treasury officials were not immediately available for comment.

A Nairobi-based banker with an international lender said he had not seen the term sheet of the proposed loan but the report was not surprising given the Treasury has pencilled in foreign borrowing of $3.2 billion this financial year.

Under President Uhuru Kenyatta, who took office in 2013 and was re-elected in 2017, total debt has rose to more than 50% of GDP, from 42% of GDP.

The government has defended the increased borrowing, saying the country must invest in its infrastructure, including roads and railways.

Public anger at the government’s higher appetite for debt has grown as the country’s top prosecutor has in the past year ordered the arrest of dozens of current and former government officials for involvement in graft in many government ministries and agencies.

The finance minister who set the borrowing targets for this financial year, Henry Rotich, was charged with corruption last month over the loss of billions of shillings in two dam construction tenders.

He denied the charges and was granted bail by the court, before Kenyatta replaced him with Labour Minister Ukur Yatani as acting finance minister.

Reporting by Duncan Miriri; Editing by Maggie Fick