Privatisation Drive Hits Roadblock: Sale of 11 State-Owned Firms Stalled as Legal Battle Looms

Kenya, 21 October 2025 - Kenya’s ambitious privatisation plan, aimed at selling 11 state-owned enterprises to boost government revenue, has hit turbulence as legal battles and public scrutiny cloud the future of the programme.

Barely weeks after President William Ruto signed the Privatisation Bill, 2023, into law, the process has been halted by a court ruling that declared key provisions unconstitutional.

The plan, which sought to fast-track the sale of public assets to raise up to KSh 110 billion, now faces an uncertain future.

The Assets on the Block

The Treasury had identified 11 government entities slated for privatisation under the first phase of the new policy.

These included the Kenya Literature Bureau (KLB), Kenyatta International Convention Centre (KICC), National Oil Corporation of Kenya (NOCK), Kenya Seed Company Limited (KSC), Mwea Rice Mills (MRM), and Western Kenya Rice Mills Ltd (WKRM).

Others are Kenya Pipeline Company (KPC), New Kenya Cooperative Creameries (New-KCC), Kenya Vehicle Manufacturers Ltd (KVM), Rivatex East Africa Ltd (REAL), and Numerical Machining Complex Ltd (NMC).

These entities, which range from manufacturing to agriculture and energy, were seen as a pathway for the government to unlock capital, attract private investment, and improve efficiency in loss-making institutions.

However, the High Court ruling in September 2024 declared the Privatisation Act unconstitutional, citing a lack of meaningful public participation and concerns over parliamentary oversight.

The Court of Appeal later declined to suspend the decision, effectively stalling any planned asset sales.

Public Concern and Political Pushback

Civil society groups and opposition leaders have argued that the rushed process could lead to the undervaluation or secret sale of public assets.

Critics say the new law weakens public scrutiny by removing the requirement for parliamentary approval in every sale, a safeguard that existed under the 2005 Act.

“Major legal changes deserve daylight, not silence,” said Okiya Omtatah, Busia Senator and a leading petitioner against the Act.

“This is about protecting Kenya’s assets and ensuring citizens have a say before the family silver is auctioned off.”

Government officials, however, maintain that the reform is crucial to cutting losses from state corporations and reducing public debt.

“Privatisation is not about selling Kenya, it’s about unblocking value and freeing resources to invest where they matter most,” said one Treasury official.

Economic Stakes and Uncertain Future

The Treasury had projected that the sales would generate between KSh 60 billion and KSh 110 billion over the medium term, supporting fiscal consolidation and investment in infrastructure. But analysts warn that the prolonged legal wrangles could erode investor confidence and delay inflows.

“Every delay sends a signal to the market that policy stability is uncertain,” noted Dr. Nyaoro Mwangi, a Nairobi-based economist.

“Privatisation can only succeed if there’s transparency, public buy-in, and political consistency.”

For now, the government has yet to release a new roadmap for the process, even as pressure mounts from international lenders for Kenya to reduce its public wage bill and restructure state firms.

Strategic Assets and Public Sentiment

Among the most contested entities is the Kenyatta International Convention Centre (KICC), which many Kenyans view as a national symbol rather than a commercial asset. The inclusion of companies in key sectors such as oil, agriculture, and dairy has also raised concerns about food security and strategic control.

In towns like Eldoret and Nakuru, workers at Rivatex East Africa and New KCC have expressed fears of job losses if the companies are sold to private investors. Others, however, see the potential for efficiency and job creation if private capital flows in.

What Lies Ahead

As the legal battle continues, Treasury officials have hinted at possible amendments to reintroduce oversight clauses while maintaining flexibility for investment. Until then, Kenya’s privatisation drive. once billed as a cornerstone of President Ruto’s economic reform agenda, remains in limbo.

For a country struggling to balance fiscal discipline with public accountability, the challenge is now not just selling assets, but restoring public trust in how those assets are managed.