The Public Debt and Privatization Committee led by Chairperson, Hon. Abdi Shurie (Balambala) questioned the Principal Secretary for National Treasury, Dr. Chris Kiptoo over the privatization programme for financial years 2023/24 and 2024/25.

The 2024 Budget Policy Statement underscored the government’s intent to expedite the privatization of Government-Owned Enterprises (GOEs) and Government-Linked Corporations (GLCs), further detailing those 11 entities had been proposed for inclusion in the 2023/2024 privatization program in line with the Privatization Act 2023.

During the meeting, Members wanted to know the total value target of the Privatization Programme and the 11 entities already earmarked.

Dr. Kiptoo in response told the MPs that National Treasury identified 11 entities for the program which include; Kenya Literature Bureau (KLB), Kenya International Convention Centre (KICC), National Oil Corporation of Kenya (NOCK) and Mwea Rice Mills.

Others are Wester Kenya Rice Mills Ltd., Kenya Pipeline Company Ltd., New Kenya Corporate Creameries Ltd., Numerical Machining Complex, Kenya Vehicle Manufacturers Ltd. and Rivatex East Africa Ltd.

According to the PS the privatization process for the 11 companies has been suspended following a court order issued on December 4, 2023 when public participation had just begun.

The Committee also heard that by the time Privatization Act 2023 came into effect, the privatization process of 14 other entities was ongoing under the 2009 Privatization Programme.

In addition, the Committee wanted to know the status of the proposal by Adani Holdings Ltd. for investment in the Jomo Kenyatta International Airport (JKIA), indicating an assessment of the costs and risks.

On the status of the proposal, Dr. Kiptoo responded by telling the Committee that a review was ongoing and once finalized he will issue a comprehensive submission on it.

Members also wanted the PS to indicate the underpinning framework, the parties involved, the related costs and risks on the Kenya Airways novation agreement for loans guaranteed by the Government.

According to Dr. Kiptoo, KQ entered into a loan agreement with Tsavo Lender for USD.924, 232,675 back in 2014 that was meant for the procurement of six Boeing 787-8 aircraft, one Genx Engine, One B777-300ER.

“KQ serviced the loan up to 2017 when it started facing financial constraints and initiated a restructuring of the facility. The company then continued servicing the loan until early 2020 when it faced financial constraints with the onset of Covid-19 and it sought a moratorium which expired in 2022 thus sought for the Government of Kenya support,” he said.