The Cabinet on Tuesday, March 21, approved the Privatisation Bill that allows the government to sell non-performing parastatals without going through Parliament.
In dispatch from State House, Cabinet outlined the benefits of the new bill that will repeal the Privatisation Act, 2005.
“The Cabinet has approved the Privatisation Bill, 2023, which will repeal the Privatisation Act, 2005. This law ushers in a more facilitative and non-inhibiting legal and policy framework that will oversee privatisation in the country.
“The proposed Bill gives power to the Treasury to privatise public-owned enterprises without the bureaucratic approvals of Parliament,” the dispatch read.
The new law makes it easy for the government to sell public companies to private investors.
The government aims to make billions of shillings in revenue from selling public entities that are currently making losses.
President William Ruto's administration seeks to use proceeds from the sale to ease the pressure to borrow in order to finance capital-intensive infrastructure projects.
Speaking on Tuesday, October 11, 2022, when he visited the Nairobi Securities Exchange (NSE), President Ruto affirmed that when public companies do well in the NSE, the government stands a greater chance of getting more capital at better terms from the bond market.
“It’s time to unlock the potential that exists at the NSE to drive the economy of our country,” he stated.
"In the next 12 months, we will have between six and ten companies listed on the Stock Exchange. I promise we will deliver on that commitment," Ruto added.
Speaking at the same event, NSE chairman Kiprono Kittony noted, “The NSE market will help highlight opportunities for global companies looking for international expansions, specifically in Africa.”
Notably, no State-owned company was sold at the NSE during the reign of former President Uhuru Kenyatta between 2013 and 2022.
Six firms were privatised during President Mwai Kibaki's term. They included KenGen, Kenya Reinsurance, Safaricom, Mumias Sugar, Telkom Kenya and Kenya Railways Corporation.
