EDITORIAL: Sale of public firms overdue - Daily Nation

Sale of public firms overdue

Friday October 12 2018

By EDITORIAL
More by this Author

The height of irony is that the government, which badly needs funds to provide vital services to the people and cater for other needs, is just staring at billions of shillings that it can easily fetch.

We are talking about the long-overdue sale of some public companies that it has no business running.

One of the most ridiculous is that the government has for years owned a company that makes just a little alcohol but imports liquor for sale.

The government is, thus, a small-time trader instead of concentrating on formulating policies to create an enabling environment for such enterprises.

It would then just collect taxes from the businesses.

SHARES

The government should now leave the marketplace. This is what prompted the establishment, in 2008, of the Privatisation Commission to advise on the sale of its stake in various companies.

Though there has been some progress, with the State’s shareholding in some of the firms being reduced, it is still holding onto others.

It should now let go, among others, the Kenya Meat Commission (KMC), Kenya Wine Agencies Limited (Kwal) and the Agrochemical and Food Corporation at Muhoroni in Nyanza.

The KMC is a particularly bad business as additional funds have in recent years been injected into the firm to revamp it, but it remains moribund.

LOOTING

To rub salt into the wound, the hobbling firm has also been looted in the past. Kwal’s privatisation is at an advanced stage with a South African firm buying a stake into it.

In the early 1960s, when indigenous Kenyans lacked the resources to run enterprises, it made some sense to have the State invest in some key industries.

But that is no longer the case. The government’s core business is not to trade, but to govern the country. It must divest from the remaining public firms.

Advertisement