Lead image for Rethink privatisation to unlock growth.
Kenya’s economic transformation should begin with a political-economy reality: the State can no longer rely solely on taxation and debt to finance demographic pressures and expanding social obligations.
With chronic unemployment, constrained revenues and a youthful population, nearly one million young people enter the labour market each year. Demand for education, healthcare, infrastructure and other services will only grow.
Against this backdrop, the National Infrastructure Fund (NIF) should become a central instrument of economic transformation. Rather than another public-spending vehicle, it should bridge the State and private capital by converting mature, illiquid public assets into productive investment and recycling proceeds into high-impact infrastructure and enterprises. Privatisation would thus cease to be ad hoc disposal of public assets or an ideological choice. It would become a disciplined, rules-based process for reshaping the relationship between the State, capital and citizens.
Anchoring privatisation within the NIF could provide both technical discipline and public legitimacy. This would require transparent valuations, independent transaction agents, clear criteria for asset transfers, competitive private-sector participation and jointly developed investment pipelines.
Dynamic growth
Such safeguards would reduce elite capture while signalling to investors that Kenya is prepared to exchange static ownership for dynamic growth. The Fund could also unlock domestic savings and international capital as sources of jobs and revenues that the State cannot generate alone.
The NIF should identify underutilised, commercially mature State assets, subject them to open valuation and competitive transfer, and ring-fence proceeds for projects capable of generating jobs, investment and additional tax revenues. Private operators would provide capital, technology and management expertise, while the State retained regulatory oversight and a share of future returns through the Fund.
The objective is a productive cycle in which dormant assets generate investment, investment expands output, and expanded output creates jobs, stronger value chains and a broader revenue base. Without such a mechanism, private capital risks remaining sidelined while public finances remain trapped in a low-growth equilibrium.