The National Assembly’s Departmental Committee on Finance and National Planning has outlined a legislative agenda aimed at strengthening Kenya’s capital markets and unlocking alternative sources of long-term financing for economic development.
Speaking during the NIFC Horizon 2026 conference, themed Financing Kenya’s Next Economic Chapter, Molo MP and Committee Chairperson Kimani Francis Kuria said Kenya must move beyond traditional bank lending and government budget allocations to mobilise long-term capital for development.
The conference was convened by the Nairobi International Financial Centre Authority (NIFCA) on behalf of the Committee and brought together industry leaders, regulators and government officials to discuss ways of expanding investment opportunities.
Kuria cited Kenya’s economic performance, including a 4.6 per cent growth rate in 2025 and a nominal Gross Domestic Product (GDP) of Sh17.6 trillion, saying the country needed alternative financing channels to achieve the ambitions of Vision 2030 and the Fourth Medium-Term Plan.
He pointed to the country’s growing domestic savings base, noting that pension assets under management had reached Sh3.167 trillion by June 2026, while collective investment schemes had approached Sh948.7 billion.
However, he observed that nearly half of pension assets were invested in government securities, calling for greater diversification into infrastructure, private equity, venture capital and renewable energy.
“Our development ambitions under Vision 2030 and the Fourth Medium-Term Plan cannot be financed through the national budget and traditional bank lending alone. Competing demands on public resources and debt-service obligations continue to constrain the fiscal space available for development,” he said.
Five priority areas for legislative reforms
To address the financing gap, Kuria outlined five priority areas requiring legislative and regulatory reforms to strengthen the capital markets ecosystem.
The first involves reviewing legal and tax frameworks to eliminate administrative barriers, avoid multiple layers of taxation and provide tax certainty. He said such changes would help position Kenya as an attractive destination for investment funds.
The second priority is modernising capital markets legislation to accommodate alternative investment funds, Real Estate Investment Trusts (REITs), asset-backed securities, corporate bonds and infrastructure bonds.
He also called for streamlined regulatory processes involving institutions such as the Capital Markets Authority (CMA), Central Bank of Kenya (CBK) and Kenya Revenue Authority (KRA) to reduce administrative delays and the cost of doing business.
On investor protection and corporate governance, Kuria called for stronger governance standards, beneficial ownership transparency and clear regulatory frameworks for digital finance and virtual assets to improve investor confidence.
The fifth priority focuses on widening participation in capital markets by creating enabling legal frameworks that encourage institutional investment in productive sectors while providing greater opportunities for small and medium-sized enterprises (SMEs), women and young people.
Kuria said the success of capital markets should not be measured solely through market capitalisation, the number of listed companies or the volume of financial transactions, but also by their contribution to the livelihoods of ordinary Kenyans.
“Ultimately, the success of capital markets cannot be measured only by market capitalisation, the number of listed companies or the volume of financial transactions. We must ask a more fundamental question: How is the growth of our capital markets improving the lives of ordinary Kenyans?” he said.
He affirmed Parliament’s readiness to work with the National Treasury, NIFCA and private-sector stakeholders to advance the proposed reforms.
Kuria called for a coordinated, whole-of-government approach to ensure that legislative changes translate into tangible economic outcomes, including increased investment, job creation and broader wealth creation opportunities for Kenyans.
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