President William Ruto on Tuesday, January 21, 2025, chaired a cabinet meeting that approved the merger of 42 state corporations into 20 entities.
A dispatch shared after the Cabinet meeting at the Kakamega State Lodge stated this is in line with the commitment to streamline government operations and reduce waste.
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The reforms include merging 42 State Corporations with overlapping or related mandates into 20 entities to improve operational efficiency and eliminate redundancy.
“Forty-two (42) State Corporations with duplicating, overlapping or related mandates are proposed for mergers to form twenty (20) entities,” read the dispatch in part.
42 Corporations merged
Additionally, four public funds currently classified as State Corporations will be declassified and returned to the relevant ministries with a strengthened governance framework.
The Cabinet resolved that all professional organizations currently categorized as State Corporations will also be declassified and will no longer receive government budgetary allocations.
At the same time, nine State Corporations will be dissolved, and their functions transferred to relevant ministries or other State entities, while 16 corporations with outdated functions that can be provided by the private sector will be divested or dissolved.
Six State Corporations will undergo restructuring to better align their mandates and enhance performance.
Fate of Employees of the Disbanded Corporations
In a subsequent statement, State House Spokesperson Hussein Mohamed on Wednesday revealed that no employee will lose a job because of the merger or dissolution.
Mohamed said all the affected employees will be reemployed in the Public Service.
What he said:
“No State Corporation function will be lost, and no jobs will be lost as all affected employees will be absorbed into the Public Service. This is in line with the commitment to streamline government operations, reduce waste, and curb excesses. The reforms will address operational and financial inefficiencies, enhance service delivery, and reduce reliance on the Exchequer.”
Kenya Power Shares
The Kenya Power and Lighting Company (KPLC) on Wednesday January 8 announced an impressive 367% increase in its share price.
In a statement, the utility company highlighted this significant surge at the Nairobi Securities Exchange (NSE), with its shares rising from Ksh1.38 in December 2023 to Ksh6.44 as of Tuesday, January 7, 2025.
“Our Managing Director and CEO, Dr. (Eng.) Joseph Siror, promised a transformation in the company’s share price and shareholder value a year ago.
This promise has been fulfilled with a remarkable 367% increase, lifting the share price at the NSE from Ksh 1.38 in December 2023 to Ksh 6.44 as of yesterday,” the statement read.
According to KPLC, this impressive performance is largely due to a turnaround strategy implemented under the leadership of the Board of Directors and state.
“This impressive performance is largely driven by a turnaround strategy that the Company has been implementing under the leadership of the Board of Directors and with support from the Government of Kenya,” read the statement.
Kiharu Member of Parliament Ndindi Nyoro, one of KPLC’s majority shareholders, saw the value of his stake in the lighting company jump to Ksh210 million from Ksh33 million six months ago after the stock’s recent rally of more than 300 percent.
Prior to the increase in its share price, KPLC had reported a net profit of Ksh30 billion for the financial year 2023/24, attributed to several factors.
CMC Motors Group announces shutdown
And in a blow to the motor vehicle manufacturing in the East African region, CMC Motors Group announced its decision to cease all its operations in Kenya, Tanzania and Uganda which will result in mass job losses.
The Group on Friday, January 17, 2025, announced its decision to gradually wind down its operations in the three countries in full compliance with local regulations and distributorship agreements, ending over 40 years of business in the region.
According to CMC, the decision follows a thorough evaluation of the business considering sustained market challenges.
“This decision follows a thorough evaluation of the business in light of sustained market challenges, including economic pressures, currency depreciation, and rising operational costs,” read part of the statement.
The company owned by CMC Holdings Ltd and acquired by the Al-Futtaim Group in 2014, explained that it has played a vital role in supporting East Africa’s agricultural sector over the past 40 years.
However, the company said that market conditions have not provided a sustainable path forward.
The company announced that it was committed to supporting its employees during this transition and that it will ensure a smooth and orderly wind-down in adherence to all relevant agreements and regulations.
History of CMC
In Kenya, CMC Motors started vehicle manufacturing in 1976 with the first car rolling off the assembly line in August 1976
Cumulative production since inception stands at approximately more than 60,000 cars, according to its website.
The plant was originally designed to produce light and heavy commercial cars including Land Rovers, Range Rovers, Volkswagen Microbuses, Leyland trucks and Buses.
The car model range dealt in also included Nissan Series, Mazda, Nissan Diesel (UD), Jaguar, MAN, Mercedes and Iveco.
ALSO BIG THIS WEEK
- The Kenya Revenue Authority (KRA) lowered tax rates for the Fringe Benefits Tax, Deemed Interest Rate, and Low-Interest Benefit.
- Bamburi Cement Limited announced changes to its Board of Directors a month after global cement giant Holcim sold its 58.6% stake in the company to Tanzania’s Amsons Group.
- Ruto announced bonuses for sugarcane farmers in Mumias, Kakamega County.
- Kenya Airways on Thursday, January 16, announced the resumption of all its operations from Jomo Kenyatta International Airport (JKIA) to Heathrow Airport in London.
- The government of Kenya announced plans to change travel policies to allow all African countries, except Somalia and Libya, entry into the country without the Electronic Travel Authorization (ETA) application.
- Safaricom PLC launched its Ziidi Money Market Fund, following approval from the Capital Markets Authority (CMA) to establish the fund last year.
- United States President Donald Trump signed an executive order temporarily suspending all U.S. foreign assistance programs for 90 days pending reviews to determine whether they are aligned with his policy goals.
- The Capital Markets Authority (CMA) issued a statement after Nairobi-based investment bank Genghis Capital failed in its bid to stop an auctioneer from attaching its office for sale to recover Ksh355 million owed to a South African businessman.
Currency Trends
The Kenya shilling remained stable against major international and regional currencies as of January 22.
It exchanged at 129.4248 per US dollar, compared to 129.5648 per US dollar on January 21, according to the Central Bank of Kenya (CBK).
List of Key Tenders Advertised by the Govt
- The Kenya Power and Lighting Company (KPLC) has invited bids for the procurement of protection and control equipments, CTs & CVTs for Transmission Substations, provision of customer satisfaction survey services, and procurement of emergency restoration towers and transmission equipment and tools.
- The Kenyatta International Convention Centre (KICC) has invited sealed bids from eligible candidates to tender for the provision of Supply, Installation, Commissioning, Operation and Maintenance of an Automated Vehicle and People Access Control, Ticketing and Revenue Collection System Partnership at KICC.
- On its part, the Kenya Petroleum Refineries Limited (KPRL) invited sealed bids from interested and eligible bidders for provision of Maintenance works on tank 304.
Other tenders
- The Kenya National Bureau of Statistics (KNBS) also invited sealed open National tenders for provision of internet services at KNBS offices.
- The Ethics and Anti-Corruption Commission (EACC) invites sealed tenders from eligible bidders for Call for Expression of Interest Professional Trainers in Ethics and Anti-Corruption- National Integrity Academy, and Provision of Hotel, Accommodation and Conference Facility Services Under Framework Contract.
- Additionally, EACC is looking bidders for Provision of Auctioneering Services and Debt Management Under Framework Agreement For 3 Years, Proposed Partitioning of EACC Machakos Office at Kiamba Mall, and Proposed Partitioning of EACC Bungoma Offices at Daima Plaza.
- The Kenya Civil Aviation Authority (KCAA) invited sealed bids from interested and eligible firms for an International open tender of Supply, delivery, installation, training and commissioning of 3D Panoramic Tower, Approach and Area Air Traffic Control Training Simulator at East African School of Aviation.
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