Muna Wahome
14 June 2002
Kenya Commercial Bank privatisation will be concluded this financial year.
At the same time, Finance Minister Chris Obure said the government was "conservatively" targeting a total of Sh3.5 billion in privatisation proceeds in the year.
KCB, 35 per cent owned by the government, is among State banks that have contributed to instability in the banking sector.
In yesterday's Budget, the National Bank of Kenya was excluded from the privatisation slate.
The privatisation of Kenya Railways - where government is seeking a single concessionare - is also set to roll out, with the minister announcing the injection of Sh1.6 billion to oil the process. He said the corporation was afflicted by old wagons and railway lines that needed rehabilitation before it could attract takers.
The long-delayed privatisation of land-line monopoly Telkom Kenya got little mention in Mr Obure's State divestiture scheme.
The government is seeking a strategic investor to take up 49 per cent stake in the telecommunications firm.
Last year, talks with the Mount Kenya Consortium collapsed after a government audit of the consortium members. They include Econet Wireless of South Africa and KPN of the Netherlands. Yesterday, Mr Obure said the government would be guided in the process by national objectives - which in this case includes consumer interests.
He said the government would soon table a draft Bill to guide the privatisation programme.
The government divestiture programme has decelerated, with only a single divestiture - that of Mumias Sugar - being carried out in the last fiscal year.
Mr Obure said the Kenya Reinsurance Corporation's privatisation was now in the final bidding stage.
For Chemelil, which was not mentioned yesterday, advisors have been appointed. But following extremely poor showing for Mumias at the Nairobi Stock Exchange and continued ailing of the domestic sugar sector, it is improbable that any sugar firm would be attractive to investors. The implementation of the Sugar Act may change matters considerably, however.
Kenya Ports Authority is in the process of privatising some of its functions, turning itself into a landlord. This is meant to increase container capacity and improve maintenance and equipment conditions.
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