Kenya, the leading economy in East Africa, has been privatizing some of its companies in order to help them stay afloat in a competitive market. The country is also opening up these companies to public scrutiny to improve transparency in their operations.
The Privatization Commission helps in the privatization of public assets such as shares in state-owned corporation. The commission was set up through an Act of Parliament.
State-owned companies up for privatization in the East African nation are;
In 2015, the government of Kenya announced plans to sell its majority stakes in five state-owned sugar companies located in the western region the country. The factories on sell include Chemelil Sugar Company, Nzoia Sugar Company Limited, South Nyanza Sugar Company Limited, Muhoroni Sugar Company and Miwani Sugar Company. The government said it will sell its 51 percent shareholding in each of these companies to strategic investors while 24 percent will be sold to employees. The rest will be sold to Kenyan farmers and members of the public.
Privation of the factories will help inject more financial capital, diversify them and strengthen the industry to make it compete favorably against sugar imports from the Common Market for Eastern and Southern Africa (COMESA).
It is government-owned corporation that was formed in 1969. It manufactures, distributes and imports wines and spirits. The government owns 72.65 percent in the wine packaging plant. The government of Kenya plans to sell 42.65 percent shares before 2018. In 2014, the government sold 26 percent shares to Distell Group Limited of South Africa.
It was formed in 1978 as a government corporation to maintain, operate and regulate all seaports on Kenya’s Indian Ocean coastline. The government invited interested investors in December 2014 who will help operationalize the Eldoret Container Terminal, construct the new Kipevu Terminal and develop berths 11, 12, 13 and 14 at a cost of US$1.5 billion. Privatization of KPA is aimed at consolidating East Africa’s biggest sea port as neighboring Eritrea, Djibouti and Tanzania scaled up efforts to expand their ports..
It was founded in 1968 as a government-owned financial institution. The government through its Ministry of Finance owns 22.5 percent shares and National Social Security Fund owns 48 percent. It started facing capital problems in 2014. National Bank of Kenya sacked its top managers in March 2016, as part of an audit to investigate the losses recorded by the bank in 2015.
Plans to privatize it started in 2008. In 2015, the government issued directions to the bank’s leadership to submit privatization option. The government has also been pushing for the bank to merge with Development Bank and Consolidated Bank, which it owns majority share in.
Privatization of these government-owned banks is aimed at pumping more capital and managerial expertise.
It was formed in 1950 through an Act of Parliament. It is the oldest meat processor in East Africa. Kenya Meat Commission is mandated with promoting the meat industry for both local and export purposes. It was re-opened in June 2006, after being closed for 15 years due to financial difficulties. In 2016, the Kenyan parliament pushed for its privatization because it has been running losses and is in dire need for modernization of its facilities.
It was founded in 1973. Kenya Pipeline Company is a state corporation that mandated with the storage, transportation and distribution petroleum products in the country. Privatization of the company is mainly aimed at supporting the government budget, increasing its capacity and enhancing transparency in its operations. In 2015, the Privatization Commission of Kenya suspended the sale of the corporation.
It was founded in 1925 as Kenya Co-operative Creameries. It underwent financial difficulties and nearly collapsed. It is the oldest and dairy processor in East and Central Africa In 2005, it was renamed New Kenya Co-operative Creameries after its revival in 2003. The Government plans to revert it to farmers by selling a majority 80 percent shareholding. It will retain between 10 to 20 percent share for oversight purposes.
It was formed in 1978 as a state corporation to produce power alcohol from sugarcane molasses. This was to help reduce the importation of petroleum oil. Its major products are alcohol, active dry yeast and wet yeast. The government privatization plans are meant to ease the company’s excess debt and boost financial and management resources.