Fund growth, PM tells stocks firms

Prime Minister Raila Odinga on Monday challenged Kenyan stock brokerage and investment banks to invest in the development of local infrastructure saying public funding is not sufficient.

He told them to get engaged in projects such as construction of roads and energy generation.

“We should not leave these investment opportunities to foreign companies only. We want our people to invest in these areas through the private/public sector partnership and not be mere spectators,” said Mr Odinga.

Noting that the two areas were particularly vibrant now, Mr Odinga encouraged local investment banks to take on road concessioning and rural electrification projects.

He spoke in an address to officials of the Kenya Association of Stockbrokers and Investment Banks (KASIB) at his Treasury office.

The PM, at the same time, called for strengthening of the capital markets saying they attracted investors to the country.

Capital markets

Mr Odinga urged Kenyans to increase their investments in the stock markets as a means of empowering themselves economically noting that the capital markets were like barometers for measuring the state of the country’s economy.

“We cannot develop our economy only on the basis of foreign investors; locals must position themselves to play a leading role in this matter,” he said.

Responding to some of their requests, Mr Odinga said the government would consider extending the period within which individuals should sell off 75 per cent of their shareholding in stock brokerage and investment banks for another three years.

He acknowledged that it would not be prudent to ask the individuals to dispose of their shares with depressed trading volumes and a general slump in the prices of listed companies at the Nairobi stock Exchange.

Amendment of section 29 of the Capital Markets Act limits any person other than commercial banks and other special institutions from holding more than 25 per cent of shareholding in stock broking companies or investment banks, a requirement that should come into effect by 1st of January 2010.

KASIB officials were led by chairman Michael Gichohi and the chief executive officer Jane Njeru.