Trimming government entities

Kenya's #1 newsletter among business leaders & policy makers

January 22, 2025

Hello 👋🏿

It's Brian from The Kenyan Wall Street. In today's edition of The Daily Brief, we delve into the government's new resolve to austerity.

Stay updated on the loan dispute between Stanbic Bank and billionaire David Langat, as well as the fresh reforms in the ETA system.

PUBLIC POLICY

Shattering the government heap

The Public Service Commission Headquarters

The Cabinet has approved the restructuring of 90 state entities and there was a lot of speculation that many civil servants will be left in the cold.

About 42 State Corporations will be merged into 20 entities to eliminate redundancy while 13 professional bodies and four public funds will be declassified. Moreover, six corporations are set to be restructured, and 16 state corporations slated to be dissolved. Although State House has assured Kenyans that employees in these bust entities will be reabsorbed in other roles, few can remember similar developments in the late 1980s and 1990s. At that time, Kenya was forced by IMF-backed reforms to trim the state costs through privatisation and massive restructuring.

Aging Workers Risk Retirement without Pension Benefits

Kenya risks a social security time bomb following systemic failures by public sector employers to remit deductions to pension schemes.

kenyanwallstreet.com/aging-workers-risk-retirement-without-pension-benefits

Today's Poll

Do you think the government's move to break up state entities will reduce budgetary deficits?

Yesterday's Poll Results

What do you think of the proposal in the new bill to have crypto firms set up local physical offices before getting licensed?

🟨⬜️⬜️⬜️⬜️⬜️ It is well in order (15.38%)

🟩🟩🟩🟩🟩🟩 Terrible, terrible legislation (84.62%)

COMPANIES

Stanbic Bank to wait a bit longer to get its loan back

Billionaire businessman David Langat

An Eldoret Court has blocked Stanbic Bank from engaging auctioneers to sell the properties of Kenyan billionaire, David Langat - which include a tea estate in Nandi and office blocks in Mombasa.

The ruling delivered by Justice Reuben Nyakundi determined that such a move would be unfair to the tycoon if an ongoing divestiture of his assets in Tanzania proves successful. Stanbic is not happy because Langat owes it KSh 20 billion since 2020 and despite entering into a restructuring agreement that would facilitate repayment, the tycoon has not been very diligent in honouring the terms. According to the judge, there is likelihood that the loan will be repaid eventually but hiccups with Tanzanian regulators and budgetary processes have delayed the sale - circumstances beyond Langat’s control.

Read more on this loan dispute here »»»

TransCentury Share Price Gains after First Half Year Profit since 2019

TransCentury returned to profitability in the 6 months to June 2024 to record a KSh 375.1 million profit from a loss of KSh 1.7 billion.

kenyanwallstreet.com/transcentury-share-price-gains-after-first-half-year-profit-since-2019

TRAVEL

Reforming our Visa-openness

Travel documents

Kenya is rolling back the Electronic Travel Authorization (ETA) requirement for travellers from other African countries – except Somalia and Libya – in order to boost the efficiency of the system.

In the recommended review of the ETA system, African visitors will be allowed to freely enter the country and reside for a minimum of two months. Those within the East African regional bloc can stay for six months. Moreover, the ETA processing option is set to be expedited to allow instant approval.

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Commentary

How the 0.1% Controls Almost One Third of South Africa’s Wealth

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Every dollar we spend, every program we fund, and every policy we pursue must be justified with the answer to three simple questions: Does it make America safer? Does it make America stronger? Does it make America more prosperous?