Nairobi — Leading hospitality industry mogul Nazir Jinnah says selling of critical state assets as proposed by the Government needs careful consideration before it is done.
He has expressed concern that the country risks losing identity by disposing off some assets like the iconic Kenyatta International Conference Centre (KICC) to private owners.
"While this might bear positive fruits, we must be careful and take a lot into consideration," he said.
While a High Court sitting in Nairobi has blocked the state from selling 11 parastatals in a suit by opposition leader Raila Odinga, President William Ruto is determined to privatize them, "in a bid to save up to Sh70 billion of the Sh250 billion being spent on running the firms."
In an interview on Tuesday, Jinnah wondered if the due diligence has been followed, in a bid to address the pertinent issues raised by Kenyans and key state stakeholders.
As it is, he lamented that it is not clear how the state intends to privatize the earmarked parastatals and who the potential beneficiaries are, among other long list of concerns.
He cautioned against hasty actions that could compromise the country's economic stability and international standing, urging a more thoughtful approach to safeguard Kenya's reputation.
Acknowledging the potential benefits of private-public investment opportunities, Jinnah advocated for engaging qualified investors capable of creating employment opportunities and fostering strategic partnerships beneficial to the nation.
He emphasized the delicate balance between progress and caution in navigating the complex landscape of asset disposal.
In a passionate call to action, Jinnah urged the government to act swiftly in recreating Nairobi's business fabric.
He stressed the importance of revitalizing key assets, such as the KICC, and reopening prominent hotels Hilton and the Intercontinental, to re-establish Nairobi as a vibrant hub for international conferences and business activities.
"Ideally, KICC is an asset worth Sh30 billion. Nominally, it should make up to Sh3 billion in a financial year. But it is only managing Sh29 million or at times Sh40 million. Is this financially realistic?," President Ruto posed during a recent joint media interview.
The President was concerned that Kenyans were overtaxed, yet there existed enormous potential to sweat the country's assets to ease the burden of tax.
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"This is the reason; I am suggesting that we sweat our assets to make more money and dividends to help ease the burden of taxation on Kenyans.," he said.
The President said that during the recent Africa Climate Summit held at KICC in Nairobi, he had to spend Sh1.8 billion to make the facility reflect its iconic image to host an international conference of that magnitude.
Kenya last privatized a state-owned company in 2008 with an initial public offering (IPO) for 25% of the shares in telecommunications firm Safaricom.
The country revised its privatization law last month to remove "unnecessary bureaucracies" according to President Ruto, who said the government's new drive would boost Africa's pipeline of company floatation.
The eleven identities for the planned divesture include profit making Kenya Literature Bureau (KLB), Kenyatta International Convention Centre (KICC), Kenya Seed Company Limited, Kenya Pipeline Company (KPC) and New Kenya Co-operative Creameries (N-KCC).
Also in the list for sale include loss making National Oil Company of Kenya (NOCK), Numerical Machining Complex, Kenya Vehicle Manufacturers Limited, Rivatex East Africa Limited.
Others are those operating in mature sectors and they include Western Kenya Rice Mills Ltd and Mwea Rice Mills.
