The Cabinet on Monday approved the creation of two major funds aimed at supporting Kenya’s long-term development — the National Infrastructure Fund (NIF) and the Sovereign Wealth Fund (SWF).
In a Cabinet statement, the government said the National Infrastructure Fund will be registered as a limited liability company and will help align government finances with national development priorities. The fund will focus on financing key public infrastructure projects while reducing reliance on heavy borrowing and high taxes.
The government plans to attract private sector investment to support priority projects. According to the Cabinet, every shilling invested through the NIF is expected to attract up to Sh10 more from long-term investors such as pension funds, development finance institutions, sovereign partners and private equity firms.
“All the money raised through the Fund will be invested in public infrastructure projects that generate long-term value for the country,” the statement said.
At the same time, the Cabinet approved the establishment of the Sovereign Wealth Fund, which will manage and invest revenues from minerals and petroleum, dividends from public investments and part of the proceeds from privatisation.
The main goal of the Sovereign Wealth Fund is to protect Kenya’s economy from unexpected shocks such as pandemics, global conflicts and other disruptions that affect supply chains and economic stability.
This will be the second attempt to establish a Sovereign Wealth Fund in Kenya. The new SWF will be created under the Sovereign Wealth Fund Bill, 2025, and will be managed for the benefit of both current and future generations.
Unlike the first SWF proposal in 2014, the 2025 Bill focuses on three main goals: stabilising the economy, funding strategic infrastructure projects, and saving for future generations under the “Urithi” pillar.
The Cabinet said the new financing approach marks a major shift towards a sustainable, investment-led development model that mobilises capital, speeds up project delivery and protects national wealth.
The National Infrastructure Fund will be run by a competitively appointed board and chief executive officer. The Sovereign Wealth Fund will operate under a strong policy framework to ensure responsible investment, financial discipline and fairness across generations.
President William Ruto has said the two funds will support a Sh5 trillion development programme over the next 10 years. Speaking during his State of the Nation address on November 20, the President said the government plans to roll out major projects in education, transport, energy and water.
Key projects include the construction of 50 mega dams, 200 mini-dams and more than 1,000 micro-dams to improve food and water security and expand farming on an additional 2.5 million acres.
The plan also includes dualling 2,500 kilometres of highways, tarmacking 28,000 kilometres of roads, extending the Standard Gauge Railway, expanding regional oil pipelines and modernising airports to improve transport and trade across the country.
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