Journey to Singapore: Questions for Parliament on how to get there

The broad consensus among Kenyans is Parliament, particularly the National Assembly, is, for all intents and purposes, a “rubber stamp” outfit at the beck and call of the Executive. 

These are the elected people who are terribly quick to pass policy, law and regulation before wailing and whining in public when it comes to implementation of the self-same policy, law and regulation.

Our performative politics prioritises cash over conviction; preferring pennies to principles.

Before you think it, this is not about “whataboutism”, that politics is a cash game everywhere. It’s about Bunge’s capacity to process the “Singapore moment” the Executive is selling to us. Following their latest jolly jamboree — last week’s Naivasha shindig — here are a few questions for the honourables.

Let’s first provide context to these questions.  We are putting 65 per cent of Kenya Pipeline Company on the market, aiming to raise Sh100 billion. 

Then we are surrendering 15 per cent of our strategic share in Safaricom for Sh200 billion in a deal that gets us another Sh40 billion in advance dividends. 

So, a total of Sh340 to 350 billion is seed capital for the National Infrastructure Fund (NIF), but we are also told 10 per cent will go into the Sovereign Wealth Fund (SWF). 

The heroic assumption is the NIF seed money will attract private investment capital in multiples. On the other hand, government’s public relations is so bad they are unable to sell the idea that the Kenya Pipeline initial public offering (IPO) will be the largest ever done in East Africa, almost three times the Safaricom IPO decades back.

Are you already mixed up? Yep, that’s what happens when policy and transactions are stirred in the same pot.  Because, remember, there’s the flip-side; to what use will this money be put?

As far as one can tell, Treasury tells us we already have a candidate list of roads, transport and logistics, energy and agro-irrigation projects then they tell us the same list is still being prepared. Remember our 2014 Eurobond?  The prospectus mentioned projects without naming them!

Critical Enablers

We are still building up to our Singapore moment, the next level of which is the official intention to halve poverty and (youth) unemployment. Oops, we missed a step. 

In addition to those three national priorities (roads/transport, energy, agro-irrigation), we also have three “critical enablers” — strategic human capital; peace, stability and security and national interest and integrity.

Let’s summarise this picture. To get to first world status, which in our view is slashing poverty and unemployment, we need Kenya Pipeline and Safaricom transactions to underpin off-budget mega-infrastructure financed through a fund not established in law and based on a list of projects that isn’t in the public domain. But we are busy arguing over the technical niceties of share pricing. For the record, there is no economic projection that puts us at first world — advanced economy — status soon. We are a lower middle-income country. 

Back of the envelope calculations tell us that Vision 2030 double digit growth rates would have gotten us to upper middle-income status by 2024, Medium Term Plan growth rates would have us there by 2027, and current growth rates put us there in 2033. 

Here’s a point to ponder. Shouldn’t our 2027 vote be about what we might look like in 2032?

But we digress, so back to those questions for MPs, some of which are already hinted at. Let’s do this from institutional to national level, and split the questions between policy and transactions.

At institutional level for both Kenya Pipeline and Safaricom, the basic transactional question seems to be about share pricing; has the former been overvalued, and the latter undervalued? 

The larger transactional question, however, is about control; to what extent are we ceding strategically important national assets to non-State control in the name of short-term cash flow? 

In the specific case of Kenya Pipeline, it is even more difficult to understand what happened to earlier policy thinking around integrated transports and logistics (pipeline-ports-rail) framework (or, in the completely unrelated case of Kenya Airways, an integrated aviation framework). This is not a case against privatisation, but a case for earlier steps, commercialisation and corporatisation.  Like Singapore.

As said before, the flip side to these transactions is the sectors they are supposed to fund. The transactional question demands a list of viable candidate projects.  The policy question splits into two. 

Capital projects

First, don’t we have existing policy and planning frameworks within which capital projects are already factored, like say, the thousands of kilometres in planned roads, or megawatts of power? Think medium-term expenditure frameworks or least cost power development plans. Or more specifically, think about the national budget process which they are largely in control of.

Second, shouldn’t we think outside the box, and ring-fence our human, not physical, capital needs? Why aren’t we talking about a real National Human Capital, not Infrastructure, Fund? It doesn’t take much to see the chaos that continually pervades our education and health sectors. And, lest we forget, the ultimate aim of our big dreams is to cut poverty and unemployment.

The real question that still remains unanswered is this – what happened to Vision 2030? The transactional, or mechanical, question here is where these Kenya Pipeline and Safaricom transactions, and the NIF and SWF, fit into the ongoing Fourth Medium-Term Plan now in Parliament. Not forgetting that privatisation proceeds were factored into the current (2025/26) budget.

Looking backwards

Do we have a proper Sessional Paper, not Kenya Pipeline and Safaricom concept notes, to guide our first world journey? That’s the forward-looking question.  Looking backwards, has Vision 2030 delivered? 

Here’s a hint from more back of the envelope calculations. A Sh18 trillion economy today would have been at Sh39 trillion at Vision 2030 growth rates; Sh28 trillion at Medium Term Plan rates. 

To be fair to our MPs, they raised important questions at last week’s retreat about a couple of these issues (share pricing, government control, legal status of the NIF). 

But there remains a sense that they miss the big picture – the Sessional Paper that defines our future pathway; the strategy that clarifies government versus markets and the resourcing that pays for our future.

That’s before we get to the small picture: how does all of this fit into the current budget cycle?