World Bank flags revenue collection concerns over Ruto’s National Infrastructure Fund

The World Bank has cautioned that the newly launched National Infrastructure Fund (NIF) will not resolve Kenya’s deep-rooted fiscal challenges, despite its potential to finance major infrastructure projects.

In its latest Kenya Economic Update released on July 9, the lender said that while the Fund will be financed through privatisation proceeds and asset sales, it is unlikely to address persistent weaknesses in revenue collection.

The World Bank also said that NIF alone will not improve public spending efficiency, emphasising the need for sustained fiscal consolidation and broader economic reforms.

“Privatisation efforts and asset sales are expected to fund commercially viable infrastructure projects through a new National Infrastructure Fund,” said the Bretton Woods Institution.

“However, this would not address the underlying structural weaknesses in revenue mobilisation and spending efficiency, underscoring the need for sustained fiscal consolidation and reforms,” the report stated.

Established under the National Infrastructure Fund Act of 2026, the Fund is one of the Kenya Kwanza government’s flagship financing projects and seeks to mobilise Ksh5 trillion for infrastructure development.

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Instead of borrowing money directly, the Fund will present infrastructure projects to private investors, pension funds, insurance companies, and development finance institutions to raise the money needed to build them.

It is expected to finance strategic projects, including the extension of the Standard Gauge Railway to Malaba and the modernisation of Jomo Kenyatta International Airport (JKIA).

To capitalise the fund, the government has partially privatised, and plans to partially privatise, several state-owned enterprises, including Kenya Pipeline Company and East Africa Portland Cement.

President Ruto has repeatedly described NIF as a key pillar of his administration’s long-term economic transformation agenda, inspired by Singapore’s development model.

However, the World Bank has cautioned that while the Fund could provide an alternative source of infrastructure financing, Kenya’s broader fiscal position remains under pressure due to persistent revenue shortfalls.

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