We Need More Public-Private Partnerships like Adani- John Mbadi

Treasury Cabinet Secretary John Mbadi, in a press briefing on October 17, 2024, revealed that the government had plans for 5 Public-Private Partnerships more like the Adani deals this financial year.

“We have committed, as part of our performance contract, to at least five projects,” said Mbadi, adding that these would include Privately Initiated Proposals (PIPs), as is the case with Adani and Jomo Kenyatta International Airport (JKIA).

Sharing his first 50 days experience in office since he was appointed to office by President William Ruto, he revealed that part of his performance contract that he signed during his swearing-in was to hand over 5 significant projects through the public-private partnership by the end of this financial year to be developed under the Public-Private Partnership (PPP).

CS Mbadi defends the PPP by saying that this is the only way to ensure that the government develops key infrastructure without heavy borrowing while retaining the National Treasury's few resources.

 He also revealed that there are plans to reduce taxes, in particular the Value Added Tax (VAT) and the Corporate Income Tax, to increase money in the pocket of common Kenyans.

“We have to reduce the pressure on Kenyans, and to do this, we must lower Value-Added Tax and corporate income tax to 25 per cent,” he said.

Additionally, Mbadi notes that most of the national infrastructure needs urgent improvement. He compares Kenya to Ethiopia and Rwanda by noting that they are improving their international airports and Kenya is being left behind, which may result in Kenya seizing as an economic hub in the region.

He noted the urgency in improving Jomo Kenyatta International Airport (JKIA). ”In the case of JKIA, the worst that can happen may be that they will not give us a fair share of the revenue that will be generated or they will be inefficient. If you use JKIA, you will realize that the current arrangement is not working properly, and we will lose to competitors. Rwanda is coming up very strongly, Ethiopia has developed its Airport, and Kenya must follow suit and do it urgently. What we must do is take care of public interests… that we are not going to have Kenyans lose jobs,” he said.

He also revealed that the International Monetary Fund had offered Kenya a 38 months extended credit facility since April 2021. To access the funds, the country had to show that it was adhering to the set conditions.

Recently, under the PPP agreement between the government and the private sector, Kenya has seen several agreements, including the Ksh 96 Billion Energy Agreement, proposed Ksh 238 Billion for JKIA modernization and Apeiro limited, which was awarded Ksh 104 Billion tenders to provide An Integrated Health Technology System.