The government received an approval for the sale of 26 companies to private investors in a bid to fund the budget deficit. Although it is not clear how much will be raised and how much the companies will go for, we hope the move will amount to ensuring a sustainable economy across the country.
State corporations haven’t exactly been performing well as one would expect. According to the 2015-16 audit report on parastatals, it was confirmed that at least 36 companies owned by the government were insolvent, and they required financial support of 118.76 billion shillings to prevent collapse.
The poor performance, according to the auditor general was attributed to pending debts that cumulatively reached millions and dating back to almost two decades ago.
Unapproved increase in expenditure and double payment of debts owed to service providers was another reason the poor performance was pinned on.
Although some firms seem to be financially stable, unscrupulous business dealings and huge losses still define some of them and if that continues, most of them might end up under receivership or being insolvent altogether.
Meanwhile, as the government is looking to reduce the number of state-owned corporations from 262 to 187, the 26 companies listed for privatization have been identified as follows:
- Development Bank of Kenya
- National Bank of Kenya
- Kenya Pipeline Corporation
- Consolidated Bank of Kenya
- Kenya Ports Authority
- Kenya Meat Commission
- East African Portland Cement
- Kengen
- Agrochemical and Food Corporation,
- New Kenya Co-operative Creameries,
- Numerical Machining Complex
- Isolated Power stations.
The sugar millers
- Muhoroni
- Miwani
- Nzoia
- Sony
- and Chemilil
Hotels and Lodges including:
- Sunset Hotel Ltd
- Kenya Safari Lodges and Hotels Ltd
- Kabarnet Hotel,
- Mt Elgon Lodge Ltd,
- Golf Hotel Ltd
Kenya Tourism Development Corporation-associated companies
- International Hotels Kenya Ltd,
- Kenya Hotels Properties Ltd,
- Mountain Lodge Ltd and
- Ark Ltd.