By Benadeta Mwaura - Kenyan based Journalist, Business Development Consultant and Digital Media Entrepreneurship Trainer.
Kenya, 18 May 2026 - There is a difference between attracting investment and slowly surrendering leverage.
For years, Kenya has defended the privatisation of public assets as a necessary economic reform, one meant to reduce pressure on taxpayers, improve efficiency, and help the government raise desperately needed revenue.
But a growing dispute inside Kenya Pipeline Company (KPC) is exposing a question the country has not seriously confronted:
At what point does privatisation stop being economic reform and start becoming strategic vulnerability?
That question became harder to ignore after reports emerged that directors at KPC are divided over the role of the Uganda National Oil Company (UNOC) in the recruitment of the company’s next managing director.
The disagreement follows Kenya’s earlier decision to sell a stake in the pipeline business tied to the regional oil transit system involving Uganda’s crude exports. While the arrangement was framed as regional cooperation and commercial integration, it is now raising concerns about influence over one of Kenya’s most sensitive strategic assets, which is the fuel infrastructure.
And this is where the debate becomes bigger than one CEO position.
Because oil is not just another sector.
Oil moves transport. It powers manufacturing. It determines food prices. It influences inflation, electricity costs and national stability.
In many ways, fuel infrastructure is the bloodstream of the economy.
So the idea that another government-linked entity could gain influence, directly or indirectly, over leadership decisions in such a sector is triggering uncomfortable questions about how far Kenya’s privatisation agenda is going.
What makes this debate even more urgent is the fragile state of Kenya’s own economy and public systems.
The recent demonstrations witnessed across the country paralysed transport, disrupted businesses and forced many parents to keep children at home after school transport systems failed to operate normally.
Entire sections of the economy slowed down within hours.
Now imagine a future where critical national infrastructure is no longer fully under Kenya’s strategic control during moments of crisis.
Imagine disruptions affecting privately controlled ports.
Imagine delays or restrictions within fuel infrastructure.
Imagine key logistics decisions being influenced by commercial or external interests during national instability.
The implications go far beyond economics.
This is why concerns around the privatisation of strategic assets such as port infrastructure and facilities like the Kenyatta International Convention Centre (KICC) continue to generate public anxiety.
KICC is not just another building in Nairobi’s skyline. It is Kenya’s diplomatic and conference nerve centre, hosting international summits, government forums, trade exhibitions and continental meetings that shape the country’s regional influence and tourism revenue.
Similarly, Kenya’s ports are not ordinary commercial assets. The Port of Mombasa serves not only Kenya but also Uganda, Rwanda, South Sudan and parts of the Democratic Republic of Congo. It is one of East Africa’s most strategic economic gateways.
Control over such infrastructure affects trade flows, regional power, supply chains and national resilience during emergencies.
And yet, discussions around privatisation often reduce these assets into simple balance-sheet entries, as if they are ordinary businesses rather than strategic national tools.
Kenya’s privatisation push did not begin with KPC.
The government has in recent years accelerated plans to privatise or partially offload stakes in dozens of state corporations under the argument that many are inefficient, loss-making or financially burdensome.
Entities that have repeatedly appeared in privatisation discussions include:
Kenya Airways
Safaricom government stake sales
Telkom Kenya
Kenya Power
New Kenya Cooperative Creameries
Numerical Machining Complex
Uchumi Supermarkets assets
Kenya Intrenational Conference Center, Port, energy and transport-linked assets have also repeatedly surfaced in restructuring and concession discussions.
Individually, each sale may appear justified.
Collectively, however, something bigger is happening:
Kenya is slowly monetising the infrastructure that once gave the state long-term economic control.
And increasingly, it appears the country is doing so from a position of financial pressure rather than strategic strength.
This is the contradiction at the centre of the debate.
The government argues privatisation reduces fiscal strain and raises money. Yet Kenya’s public debt continues to rise, with debt servicing consuming an increasingly large share of national revenue.
That means the country is simultaneously:
Selling assets
Borrowing more
Paying more interest
And losing future revenue streams
This creates a dangerous cycle.
State corporations are often sold to solve short-term liquidity problems, but once sold, the government loses part of the long-term income and strategic control those institutions generate.
The result is that the state becomes financially weaker over time, even after selling assets.
The controversy around Uganda’s involvement in KPC leadership discussions is important because it transforms privatisation from an economic debate into a sovereignty debate.
Regional cooperation is normal. Shared infrastructure is normal.
But strategic dependence is different.
Imagine, for a moment, a future where external influence extends beyond logistics into operational decision-making within critical energy infrastructure.
Who controls pricing leverage?
Who influences supply priorities during crises?
Who controls strategic reserves?
Who makes decisions during regional disruptions?
These are no longer hypothetical questions in a world where oil has become deeply geopolitical.
The Iran crisis already demonstrated how quickly energy markets can destabilise economies. Kenya itself experienced fuel anxiety, supply pressure and concerns over stock levels despite official assurances.
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And the ongoing demonstrations across the country, tells it all/
Now imagine similar pressure combined with weakened national control over strategic infrastructure.
Ironically, even some of the world’s most capitalist economies rarely surrender full strategic control over critical infrastructure, and when they do allow foreign participation, it is usually under extremely strict oversight.
In the United States, sectors such as energy, ports, telecommunications and critical technology are heavily scrutinised through national security reviews conducted by bodies like the Committee on Foreign Investment in the United States (CFIUS).
Over the years, Washington has blocked or forced reversals of several foreign acquisitions involving strategic assets.
Chinese-linked firms have faced restrictions on acquiring American port infrastructure, semiconductor companies and telecommunications networks over fears that foreign control could expose the country to economic or security vulnerabilities.
Even the debate around apps like TikTok eventually evolved into a national security issue because of concerns over data and strategic influence.
The same United States that champions free markets globally still maintains enormous influence over its strategic infrastructure through regulation, military oversight and political control.
In moments of crisis, the state retains the power to intervene directly in supply chains, fuel reserves and transportation systems.
China takes an even more aggressive approach.
While China embraces global trade and investment, its most strategic sectors remain tightly controlled by state-linked corporations.
Energy giants, telecommunications firms, rail systems, ports and critical mineral supply chains all operate under structures closely aligned with Beijing’s national interests.
Chinese authorities understand that infrastructure is not simply commercial; it is geopolitical power.
This is why China has spent years acquiring influence over global ports and logistics corridors through initiatives like the Belt and Road Initiative while simultaneously ensuring its own domestic strategic sectors remain firmly protected from foreign control.
The Middle East offers perhaps the clearest lesson of all.
Countries such as Saudi Arabia, the United Arab Emirates and Qatar did not respond to oil wealth by selling off their energy infrastructure during economic difficulties. Instead, they built sovereign wealth around it.
Saudi Arabia transformed Saudi Aramco into one of the most powerful state-controlled oil companies in the world, using oil revenues to build roads, cities, investment funds and global influence. Qatar used natural gas wealth to create one of the world’s largest sovereign wealth funds, investing strategically across aviation, real estate, banking and sports globally.
Even within Africa, countries that have experienced the dangers of external dependence tend to guard strategic assets more aggressively.
Nigeria, despite years of corruption and inefficiencies in its oil sector, still treats petroleum infrastructure as a matter of national sovereignty.
Algeria has historically imposed tight restrictions on foreign participation in its hydrocarbon sector, maintaining strong state involvement through Sonatrach, its national oil company.
Algeria’s leadership has long viewed energy as too strategic to be fully exposed to external control, particularly given the country’s political and security history.
The common thread across all these countries is simple:
Strategic infrastructure is not treated merely as a business.
It is treated as insurance.
As leverage.
As geopolitical protection.
As a national survival tool during crises.
That is what makes Kenya’s current trajectory so sensitive.
Because when financially pressured states begin monetising strategic infrastructure too aggressively, they may solve immediate budget problems while quietly weakening their future economic independence.
What makes Kenya’s privatisation debate particularly concerning is how narrowly it is often discussed.
The focus is usually on: How much money can be raised immediately.
Rarely do we ask:
What revenue is lost over 20 years?
What strategic power disappears?
What future dependency is created?
A country can survive temporary debt pressure.
But losing leverage over strategic sectors can reshape an economy for generations.
Kenya’s challenge today is not simply whether privatisation is good or bad.
The real question is:
Are we restructuring intelligently, or liquidating strategically important assets because we are financially cornered?
Because those are two very different things.
And the KPC debate may be the clearest warning yet that the country is beginning to blur the line between partnership and dependence.
The danger is not that Kenya is attracting investors.
The danger is that, step by step, strategic assets may stop being truly Kenyan in anything but name.
The writer is a Kenyan based Journalist, Business Development Consultant and Digital Media Entrepreneurship Trainer.
The opinions expressed in this article are those of the writer and do not necessarily reflect the views of Dawan Africa.