Kenya plans to channel future oil and mineral revenues into three separate accounts; Stabilisation, Strategic Infrastructure Investment, and, Future Generations — creating a structure designed to safeguard savings, fund key projects, and shield the economy from revenue shocks.
- •In the draft Sovereign Wealth Fund Bill, 2026, at least 10% of transfers are earmarked for the Future Generations Component, while the Stabilisation Component is capped at KSh 10 billion, unless the Cabinet Secretary prescribes a higher amount.
- •The Strategic Infrastructure Investment Component will finance projects in sectors such as transport, energy, housing, and health, using Holding Account transfers and 50% of its own income, and withdrawals are tied to the Stabilisation balance.
- •The Fund is sharply restricted to foreign, liquid, and investment-grade assets, steering clear of domestic securities, unlisted real estate, private equity, commodities, art, and other high-risk instruments.
The fund would collect the government’s share of profit petroleum, royalties from oil and minerals, petroleum bonuses, payments for mining rights, earnings from government stakes in resource projects, and proceeds from divestments. Under the revised plan for the Turkana oil fields, Kenya’s share of profit oil is projected to rise from 50% in early production phases to 75% at peak output.
All resource revenues would first be deposited into a Central Bank Holding Account. Transfers from the account to the three separate accounts must occur within 10 days of revenue receipt.
Each component has its tailored limits: the Future Generations account can only hold internationally rated debt, IMF or World Bank obligations, BIS deposits, and qualifying foreign bank instruments; the Stabilisation account may use similar instruments and risk-reducing derivatives; and the Strategic Infrastructure account is confined to foreign-currency debt, interest-bearing deposits, and derivatives tied strictly to those assets.
None of the three components may serve as collateral or provide loans or advances to the government, state agencies, counties, or private entities, ensuring that the Fund’s resources remain insulated from domestic fiscal and political pressures.
Kenya has a high public debt burden, with debt servicing consuming more than half of recurrent spending, leaving limited fiscal space for infrastructure investment. The sovereign wealth fund plus the newly assented National Infrastructure Fund have been slated to smooth these fluctuations, shielding the national budget from shocks while creating a predictable pipeline for strategic infrastructure.
The governance of the fund rests with a seven-member Board and a competitively recruited CEO. They include a chairperson appointed by the President, the Treasury PS, the Mining PS, the Petroleum PS, the CBK Governor, and 4 non-public officers appointed competitively by the Treasury Cabinet Secretary.
Withdrawals from Stabilisation and Strategic Infrastructure Components must comply with fiscal responsibility rules and be approved by the Cabinet and submitted to the National Assembly. The bill imposes steep penalties for misuse of fund assets. Officials who misappropriate money or act outside the law face repayment of twice the loss, fines of at least KSh 10 million, and up to five years in prison, with personal liability continuing even after leaving office.
The Fund is also shielded during election periods: no withdrawals or transfers are allowed within three months of a general election, and the Board must certify balances and submit reports to the Auditor-General and Parliament.
The Bill also defines significant depletion as a 90% decline in resource revenue and deposits sustained for two years. If triggered, the three accounts merge into a single Fund, and withdrawals are limited to earnings and dividends while preserving the principal. Quarterly and annual financial statements, including audited reports, are required, and budget documents must disclose expected revenue, Fund spending, and investments.
Transitional arrangements will allow the Cabinet Secretary to appoint an interim manager and staff before the Board is constituted. Amendments to the Mining Act, Petroleum Act, and Kenya Revenue Authority Act are included to ensure all relevant revenue flows into the Fund.
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