The Kenyan Cabinet has approved the Privatization Bill 2023, a state-sponsored bill that seeks to sell Govt-owned entities to the private sector without Parliamentary approval. The cabinet approval means the Ministry of Treasury will have the power to sell non-strategic parastatals without legal and policy bottlenecks.
The Government hopes that the new law will allow the private sector to contribute to the economy by owning shares in the entities and reduce the demand for government resources and reliance on government financing by the parastatals.
The Bill gives power to the National Treasury to identify and determine which public enterprises will be privatized, without the approvals of Parliament. The Privatization Commission will be turned into a parastatal called the Privatization Authority, domiciled at the Treasury, responsible for the implementation of the sale.
According to the Daily Nation Newspaper, some of the corporations that the government has earmarked for privatization include Chemelil Sugar, South Nyanza Sugar, Kabarnet Hotel, Mt Elgon Lodge, Golf Hotel, Nzoia Sugar, Miwani Sugar, Sunset Hotel Kisumu, Kenya Safari Lodges and Hotels, Consolidated Bank, Development Bank of Kenya, Agro-Chemical and Food Company, Kenya Wine Agencies, Kenya Meat Commission, and public universities.
According to the Cabinet dispatch, the sale of non-strategic, non-performing public entities will help finance the upgrade of infrastructure and improve the delivery of services to Kenyans. It will also generate revenues for the government, reduce conflicts between the public sector’s regulatory functions and commercial functions, and develop Kenya’s capital markets.
The approval of the Privatization Bill 2023 comes just five months after President William Ruto stated that the government is seeking to privatize ten state firms within a year through the Nairobi Securities Exchange.
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