National Treasury receives final report on mobilizing domestic capital for PPPs

The National Treasury on Friday officially received the final report from the Committee of Experts (CoE) on Mobilising Domestic Capital for Public-Private Partnerships (PPPs).

The handover ceremony held in Nairobi was presided over by Principal Secretary for National Treasury, Dr Chris Kiptoo with the report’s proposals expected to strengthen Kenya’s infrastructure financing through local capital markets.

The Committee of Experts was appointed on February 3, 2025, and tasked with exploring, designing, and recommending policy, legal, regulatory, and administrative reforms aimed at accelerating the mobilisation of long-term capital from domestic sources for PPP projects.

Speaking at the event, Dr. Kiptoo highlighted the underutilised potential of domestic capital in supporting development.

“Since 2013, Kenya has successfully mobilised approximately Ksh.140.7 billion in private capital through PPPs. However, this represents only a fraction of what can be achieved by effectively harnessing our domestic capital markets," he said.

He further added: “As the National Treasury and Government, we’re giving ourselves one month to review the report and provide a clear pathway for its implementation.”

The central proposal of the report is the establishment of a Public-Private Partnership Implementation Trust Fund (PPP-ITF), envisioned as a dedicated vehicle for mobilising and deploying long-term domestic institutional capital—such as pension and insurance funds—into infrastructure projects.

According to the report, the trust fund would help finance both the construction and operation phases of PPP projects, reduce reliance on sovereign guarantees, and provide steady returns to investors.

Dr. Hosea Kili, Chair of the Committee of Experts, said the PPP-ITF represents a shift in Kenya’s approach to financing infrastructure.

“The PPP-ITF represents a paradigm shift in how we finance our nation's development,” said Dr. Kili. “By creating a structured mechanism that aligns the interests of institutional investors with national development priorities, we can build sustainable infrastructure while generating consistent returns for Kenyan savers and pensioners.”

Director General of PPPs at the National Treasury, Eng. Kefa Seda, emphasised that the rest of the report’s recommendations are designed to support and operationalise the proposed trust fund.

“The PPP-ITF will leverage financing from the public sector, either from the national government or contracting authorities, to match private sector funding, thereby enhancing the viability and sustainability of infrastructure investments,” said Seda.

He acknowledged that some recommendations may require legislative changes, while others can be implemented through administrative measures. “Let me assure you that the Directorate fully supports the initiative and will put in all efforts to implement the agreed recommendations,” he said.

The report outlines governance structures, risk mitigation measures, and implementation strategies to guide the operationalisation of the PPP-ITF. The National Treasury is expected to review the document and develop an implementation plan over the next month.

The handover ceremony was attended by representatives from financial institutions, pension funds, insurance companies, development partners, and senior government officials, reflecting broad stakeholder interest in the initiative.