The Kenya International Convention Centre (KICC), Kenya Literature Bureau (KLB), National Oil Corporation of Kenya (NOCK), Kenya Seed Company Limited (KSC), Mwea Rice Mills Ltd (MRM), Western Kenya Rice Mills Ltd (WKRM) and Kenya Pipeline Company Limited (KPC) are among the eleven state corporations that have been set for privatisation.
The announcement comes just a month after the president signed into law the Privatisation Bill 2023, that handed the National Treasury unchecked powers in the sale of state entities.
In a notice to the public, the National Treasury and Economic Planning Cabinet Secretary Njuguna Ndung’u said they have prepared the programme in accordance with the Privatization Act 2023 and that it can now be accessed on the National Treasury website.
According toNjuguna, National Oil Corporation of Kenya (NOCK) is being privatised largely because of poor financial performance after perennially posting huge losses.
The government is also looking to hand out the corporation because of negative working capital and low liquidity.
For KICC the CS argues that its privatisation will generate additional revenue for the government and reduce the demand for exchequer support.
“KICC operates in a mature and competitive sector of the market, with other private sector players offering similar services both locally and regionally.” Njuguna said in the 2023 Privatisation programme.
“The National Treasury and Economic Planning has prepared the 2023 Privatization Programme in accordance with the Privatization Act 2023. The Programme can be accessed from The National Treasury website. Further, privatization and restructuring are geared towards the Government’s efforts for fiscal consolidation and spurring economic development through the raising of additional revenue.” Njuguna said in a statement.
The others include; New Kenya Cooperative Creameries, Numerical Machine Complex, Kenya Vehicle Manufacturer Limited and Rivatex East Africa Limited
The notice indicated that the majority of the listed companies have been making losses over the years and relying on the GoK for recurrent and development budgets.
The move to privatize state corporations is anchored on the Kenya Kwanza efforts for fiscal consolidation and spurring economic development through raising of additional revenue, reducing the demand for government resources as well and Improving regulatory framework in the economy by unbundling regulatory and commercial functions among some entities.
The CS said that the move will improve efficiency in the economy by encouraging more private sector participation hence making the economy more responsive to market force and competition.
Last year, President Ruto said government would list at least 10 state owned enterprises at the Nairobi Securities Exchange (NSE) in 12 months to re-awaken the country’s capital market.
He said the government would bring six to ten companies to the market through initial public offerings (IPOs) , urging the private sector to also list at least five firms.
“My administration will revitalize the capital markets by privatization of State-owned enterprises, where divestiture is overdue and strategic.” He previously said.
Recently, foreign investors have been exiting the Nairobi Securities Exchange. The exit eased by Sh320 million in the three months to September 2023 but still managed to impact the bourse, reducing its value for a third straight quarter.
In the period between July to September 2023, foreign investors pulled out Sh1.18 trillion, a drop from the Sh1.5 billion recorded in the second quarter of the year.
In the last six months, only two recorded positive inflows at the NSE.