KENYA – The Kenya Defence Forces (KDF) through the Ministry of Defence has written to the Privatisation Commission to exempt the Kenya Meat Commission (KMC) from the list of State-owned enterprises that Cabinet has approved for sale.
According to reports by The East Africa, the Privatisation Commission which was brought into being by the Privatisation Act (2005) was mandated to sell of 26 poorly performing parastatals to strategic investors to reduce their reliance on the exchequer.
The sale of state-owned enterprises was also expected to mobilise resources and support the government’s budget and boost activity on the Nairobi Stock Exchange (NSE) as some were expected to float shares through initial public offerings.
The parastatals the government approved for sale other than the meat processor include five sugar millers: Chemilil, Sony,Nzoia, Miwani and Muhoroni, Agrochemical and Food Corporation, New Kenya Co-operative Creameries, Kenya Wine Agencies Ltd (KWAL), among others.
“Last month, we received a letter from the Ministry of Defence asking that we remove the Kenya Meat Commission from the list of the privatization programme.”Privatisation Commission Chief Executive – Joseph Koskey
The State reckons that privatisation will make KMC economically viable and boost the export of animal products.
The KDF wants KMC to be exempted from the sale plan indicating that it is set to inject cash to revive the ailing meat plant.
“Last month, we received a letter from the Ministry of Defence asking that we remove the Kenya Meat Commission from the list of the privatisation programme,” Privatisation Commission chief executive Joseph Koskey said.
The KDF took control of the cash-strapped meat firm following an Executive order from President Uhuru Kenyatta, reassigning the ministerial roles of KMC from the Ministry of Agriculture and Livestock to the Ministry of Defence ministry in a bid to give the cash-strapped State-owned firm a lifeline.
Following the move, allocation of funding for the firm will now come from the Ministry of Defence who will be expected to invest and modernise the plant as well as help expand its market both locally and internationally.
The directive was, however, challenged after the Law Society of Kenya filed a petition court contesting the legality of the transfer of KMC to Kenya Defence Forces for lack of public participation.
The lawyers’ lobby further argued that the responsibilities of the parastatal could not be transferred without an amendment to the Kenya Meat Commission Act.
They also termed the move as commercialisation of the Ministry of Defence, which is inconsistent with the provisions of the Forces Act.
The court in February issued a ruling directing the Ministry of Agriculture and the Attorney-General to regularise the transfer of the KMC to the military within 90 days.
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