Ten key events that will shape Kenya's economic future in 2026

1. Securing a New IMF Programme

Discussions with the International Monetary Fund (IMF) will dominate the first half of the year.
Kenya is actively negotiating for a new funding arrangement. The stakes could not be higher. After the tumult of 2024, Gen Z-led protests and the stalling of key reforms, a new agreement is seen as the essential anchor for macroeconomic stability, a catalyst for concessional funding from other multilateral lenders, and a crucial signal to jittery international investors. The core sticking points remain, analysts warn, including the treatment of securitised debt (like the road annuity programme), the pace of fiscal consolidation, and tangible progress on structural reforms, particularly privatisation. Failure to secure a credible programme would severely strain public finances and shake market confidence, analysts say.

2. The Launch of the National Infrastructure Fund: A Test of a New Financing Model

President Ruto’s declaration that the National Infrastructure Fund (NIF) will be operationalised in January is a central pillar of his plan to wean the state off expensive commercial debt for public works. The Fund’s success hinges on its ability to “innovatively mobilise domestic resources” and strategically monetise mature public assets. In 2026, watch for its legal and governance framework, the identification of its first flagship projects (likely from the President’s stated priorities), and, most critically, its success in attracting pension and private capital. Its performance will be a live test of whether Kenya can pivot to a more sustainable, equity-based infrastructure financing model.

3. The Sovereign Wealth Fund

Twinned with the NIF is the planned establishment of the Kenya Sovereign Wealth Fund (SWF). 2026 should see its legal enactment and the crucial debate over its seed funding. Expectations are that initial capital will come from future proceeds of parastatal sales and, potentially, natural resource revenues. The transparency of its governance structure, the clarity of its investment mandate (savings vs. development), and the source of its first capital injection will be closely scrutinised by markets and civil society. A well-designed SWF could be a legacy institution; a poorly designed one risks being a hollow shell or a target for misuse.

4. The 2026-27 Budget: Ruto’s Penultimate Fiscal Tightrope Walk

Treasury Cabinet Secretary John Mbadi’s presentation of the 2026-27 budget in June will be a masterclass in political and economic balancing. As President Ruto’s second-last full budget before the 2027 elections, it must walk a tightrope between demonstrating fiscal discipline to the IMF and markets, and funding development priorities and potentially populist measures to shore up political support. CS Mbadi’s pledge not to introduce new taxes will be tested against the relentless pressure to raise revenue, with the shortfall likely leading to increased domestic borrowing—crowding out the private sector—or deeper spending cuts.

5. The Privatisation Agenda: Spotlight on Kenya Pipeline and Regulators

After legal and political delays, the government’s privatisation programme is poised for action in 2026. The potential strategic sale of a stake in the Kenya Pipeline Company (KPC) will be the flagship transaction, testing investor appetite for core state assets. The process will be complex and politically sensitive. Focus will shift to regulators—the Capital Markets Authority (CMA) and the Nairobi Securities Exchange (NSE)—to ensure the transaction is conducted transparently, with fair valuation, and in a manner that protects minority shareholders and deepens the capital market.

6. Safaricom Stake Sale: A Market-Moving Litmus Test

Separate from the privatisation of loss-making entities, a defining capital markets event for Kenya in 2026 will be the conclusion of the government’s sale of its stake in Safaricom PLC. This transaction is a flagship initiative of the state’s asset monetisation program, aimed at raising non-tax revenue and broadening public ownership of the national telecoms champion. 

7. The Public Debt Crucible: Navigating the Maturity Wall

Underpinning every other event is the relentless challenge of public debt management. Kenya faces a wall of external debt maturities in the coming years. The government’s strategy in 2026 will be multi-pronged: securing favourable IMF and World Bank terms to maintain concessional flows, proactively managing domestic debt auctions to stabilise interest rates, and pursuing liability management operations (like buybacks or swaps) to smooth the repayment profile. The debt-to-GDP ratio, currently hovering near 70 per cent, will be a key metric watched by all rating agencies and investors.

8. Turkana Oil: Reaching for Final Investment Decision

After years of fits and starts, 2026 is a pivotal year for the Lokichar oil project. The consortium led by new owners must make tangible progress towards a Final Investment Decision (FID). Key milestones include securing a strategic partner for the upstream, finalising the plan for the crude oil pipeline to Lamu, and concluding host community agreements.

Any significant advancement would boost Kenya’s energy sovereignty and export prospects, while further delays would cast serious doubt on the project’s commercial viability.

9. Groundbreaking on Rironi-Mau Summit and SGR to Malaba

Vision must turn into ground-breaking. This year will see the physical acceleration of two legacy-defining transport projects: the Rironi-Nakuru-Mau Summit Highway (a critical PPP) and the long-awaited commencement of the SGR extension from Naivasha to Malaba.

Progress on these sites will be the most visible proof of the administration’s execution capability. They are also geopolitical flashpoints, with the SGR extension’s financing and contractor (Chinese firms) being a subject of intense international interest.

10. Full Rollout of KESONIA: Transforming the Cost of Credit

Finally, a silent revolution in the financial sector will mature: the full implementation of the Kenya Secured Overnight Financing Rate (KESONIA) as the benchmark for pricing all loans. This shift from the old Kenya Banks’ Reference Rate (KBRR) is fundamental. By early 2026, most new corporate loans, mortgages, and personal loans should be priced off this more transparent, market-driven rate. Its successful embedding will determine the true cost of credit for businesses and households, impacting investment decisions and economic activity across the board.