The cabinet has approved the privatization of the Development Bank of Kenya and at least five state-owned hotels and lodges through the sale of their shares.
The announcement was made after a cabinet meeting that was chaired by President William Ruto on Wednesday, February 14.
The cabinet said that the move was part of Kenya Kwanza’s administration’s plan to steer the turnaround of State Corporations and other State-Owned Enterprises.
“The decision by our nation’s apex policy-making organ was informed by the fact the Bank had fully transitioned into a fully-fledged Deposit taking commercial bank regulated by the Central Bank of Kenya (CBK),” read a dispatch released on Wednesday.
The hotels to be privatized include Kenya Safari Lodges and Hotels Limited (incorporating Mombasa Beach Hotel, Ngulia Safari Lodge, and Voi Safari Lodge), Golf Hotel Limited, Sunset Hotel Limited, Mt. Elgon Lodge Limited and Kabarnet Hotel Limited.
The approval follows a previous decision by the cabinet to offload non-strategic parastatals said to be loss making agencies as a way of turning them around.
President Ruto had earlier last year, approved the Privatisation Bill, 2023 passed by Parliament, paving way for the privatization of loss-making agencies by the government.
The new law repealed the Privatisation Act, 2005 which was enacted before the current Constitution.
It also removed the bureaucracy in the privatisation of non-strategic or loss-making government entities.
The Bill encouraged more participation of the private sector in the economy by shifting the production and delivery of products and services from the public sector.
It also improved the infrastructure and delivery of public services through the involvement of private capital and expertise.
The government had last year announced plans to privatise 26 parastatals, including the National, Development and Consolidated Banks, Kenya Meat Commission, East African Portland Cement, KenGen, Kenya Pipeline Corporation and the Kenya Ports Authority.
Others were the Agrochemical and Food Corporation, New Kenya Co-operative Creameries, Numerical Machining Complex and sugar millers, as well Kenya Tourism Development Corporation and associated companies.
Privatisation, it is projected, will increase efficiency and therefore profits and eliminate political interference and its associated ills, such as nepotism.
