Tread carefully on privatisation of treasured national assets

Kenya Pipeline Company storage facilities in Nairobi. KPC was privatised through an initial public offering. [File, Standard]

Over the past year, the government has steadily moved towards privatisation as a central economic policy. Parliament and the President have talked about the selling of some State-owned corporations in positive terms, arguing that reducing government ownership of major companies will provide income that we so desperately need and reduce our reliance on debt. On paper, this makes sense as the burden of debt is crippling. But the question Kenyans must contend with is whether, beyond this flood of income, some national assets should in fact be treated as commodities for capital.

This debate has been brought sharply into focus by the latest development involving Safaricom, Kenya's most profitable company. Parliament and the High Court this month approved the sale of a further 15 per cent government stake to Vodacom, the South African telecommunications group that already holds a large share in the company. If completed, the deal would give Vodacom majority control of a firm that has become deeply embedded in the daily lives of millions of Kenyans. Vodacom's stake would rise to 55 per cent, whilst that of the government would fall to 20 per cent.