Kenya’s President, William Ruto, announced on Thursday plans for the privatization of 35 state-owned companies entangled in bureaucratic hurdles, aiming to enhance efficiency following recent legislative changes.
The revised privatisation bill, signed into law by his government last month, facilitates the easier transfer of state enterprises to private entities, intending to bolster the private sector’s involvement in the economy, as stated by the presidency during the signing.
Addressing a gathering of African stock market officials in Nairobi, President Ruto disclosed, “We have identified the first 35 companies that we are going to offer to the private sector,” emphasizing that approximately 100 other state-owned firms were under consideration.
He highlighted the need to liberate these enterprises from government red tape, indicating that their services could be better managed by private entities, promising, “We will make this opportunity available.”
Despite being an economic powerhouse in East Africa, Kenya faces various challenges, including fiscal depletion, surging inflation, and a depreciating currency resulting in escalating debt repayment costs. The International Monetary Fund (IMF) recently approved a $938-million loan for Kenya, which also faces a $2-billion eurobond repayment next year.
The IMF urged the government to enact reforms, particularly in state-owned firms like Kenya Power and Kenya Airways, both of which incurred significant losses in 2022.
Additionally, the World Bank announced plans to extend $12 billion in support to Kenya over the next three years. By June’s end, Treasury figures indicated Kenya’s debt at over 10.1 trillion shillings ($66 billion), equivalent to around two-thirds of its gross domestic product.