Kenyan President William Ruto has unveiled plans to establish a sovereign wealth fund and an infrastructure fund, aiming to increase investment in key sectors while avoiding further public debt accumulation. This move comes as Kenya seeks a more sustainable financing strategy after years of borrowing to fund large-scale infrastructure projects, which has left the country with one of the highest debt service-to-revenue ratios in Africa.
The government intends to mobilize domestic resources and leverage state assets to fund these initiatives. A newly passed privatization law allows for the partial sale of state-owned enterprises, with the Kenya Pipeline Company set to be the first to undergo a share sale. Proceeds from this transaction, estimated at around 130 billion Kenyan shillings (approximately $1 billion), will be used to capitalize the sovereign wealth and infrastructure funds.
The infrastructure fund will focus on supporting the agricultural sector, which is central to Kenya’s economy, to enhance productivity and expand exports. It will also finance the expansion of the country’s electricity generation capacity, currently at about 2,300 megawatts, with plans to add an estimated 10,000 megawatts to support industrialization.
President Ruto has not yet specified when the sovereign wealth fund and infrastructure fund will become operational.
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