The National Treasury has unveiled a draft bill proposing the establishment of a Ksh 200 billion Sovereign Wealth Fund (SWF) aimed at promoting prudent management of Kenya’s natural resource revenues and ensuring long-term financial sustainability.
The proposed Kenya Sovereign Wealth Fund Bill, 2025, seeks to provide a legal framework for the investment, management, and safeguarding of proceeds earned from the country’s natural resources such as oil, gas, and minerals.
According to Treasury Cabinet Secretary John Mbadi, the fund’s creation aligns with constitutional provisions on openness and public participation, specifically Articles 201(a) and 232(1)(d), which promote transparency in the management of public finances.
Under the draft bill, the fund will be owned by the National Treasury and held in trust for all Kenyans. Its key purpose is to act as a financial buffer during periods of revenue decline or economic instability, while also supporting major infrastructure projects that promote national development and job creation.
The Sovereign Wealth Fund will be structured into three key components:
- Stabilisation Component – To cushion the economy from fluctuations in resource revenues and manage extraordinary macroeconomic shocks.
- Strategic Infrastructure Investment Component – To finance critical infrastructure projects that spur economic growth.
- Future Generation (Urithi) Component – To save a portion of the country’s resource income for future generations.
All revenues will first be deposited into a Holding Account at the Central Bank of Kenya, with allocations determined annually by the Treasury CS. The bill stipulates that at least 10 per cent of the fund must be saved for future generations.
If enacted, the Kenya Sovereign Wealth Fund will not only enhance fiscal discipline but also ensure that the nation’s natural wealth benefits both current and future generations.
