Revive parastatals sale plan

Revive parastatals sale plan

The appointment of a full board at the Privatisation Commission must revive the plan to sell stakes in several State-owned companies.

Several State-owned companies, including 13 major hotels, five sugar millers and two commercial banks, have since 2011 been scheduled to be privatised, partly due to lack of a full board at the commission.

Kenya needs to sell these entities and others for a variety of reasons. First, it will help raise funds to plug a hole in the budget that has seen the government increase reliance on debts to meet its obligations.

Second, the business of running enterprises should be shifted to the private sector with the State’s role confined to providing an enabling environment for entrepreneurs.

Governments are not known to be good at running companies, leading to the proliferation of inefficient, loss-making and debt-plagued State corporations.

Third, the reduction of the State ownership through listing at the Nairobi Securities Exchange (NSE) is expected to unlock liquidity of the stocks at the bourse and attract investors to the market which is already facing a shortage of listings.

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