Category: Business Daily

John Mbadi, as Kenya’s Cabinet Secretary for the National Treasury and Economic Planning, carries a tremendous responsibility at a crucial juncture.

Faced with considerable challenges-ranging from high public debt and inflationary pressures to youth unemployment and regional disparities-Mr Mbadi’s priorities underscore an admirable vision.

His commitment to mobilising private capital through public-private partnerships, equitable distribution of resources and reforming tax systems, all form a solid backbone for steering Kenya toward stability and growth.

However, to fully meet Kenya’s multifaceted economic realities, it is essential to consider a more expansive and nuanced approach, one that not only builds on his stated priorities, but also aggressively harnesses Kenya’s demographic potential and global best practices, to create a genuinely sustainable development path.

At the core of Mbadi’s strategy is the mobilisation of private capital, especially via partnerships aimed at infrastructure, manufacturing, technology, logistics and education, and healthcare sectors- areas foundational to Kenya’s long-term economic competitiveness.

Addressing infrastructure gaps is crucial, as these directly impact productivity.

While this focus rightly targets investment deficits, it can be further strengthened by emphasising the creation of an enabling environment for domestic and foreign investors through regulatory reforms, reductions in bureaucratic bottlenecks and transparent contractual frameworks that enhance investor confidence.

Equitable resource distribution; a priority Mr Mbadi has explicitly voiced, holds key social and economic significance, given Kenya’s entrenched regional disparities.

His commitment to prioritise marginalised counties by rolling out development projects, ensures that growth benefits resonate nationwide and prevent social fissures.

Here, the integration of county governments in planning and budgeting processes under the public planning bill, must be executed with rigor to avoid misallocation and inefficiency.

Strengthening capacity at county levels and enforcing accountability will be crucial measures, combined with participatory mechanisms that engage local communities to meet actual needs.

Tax reform and revenue mobilisation remain critical pillars in Mr Mbadi’s fiscal management blueprint. His emphasis on reforming and modernising the Kenya Revenue Authority (KRA) through digitisation and AI-enabled enforcement mechanisms, is forward-looking and essential to broaden the domestic revenue base without increasing tax rates unduly.

Nevertheless, this should be paired with deliberate efforts to foster taxpayer education and build trust, particularly tackling widespread evasion and corruption perceptions that undermine compliance.

Simplifying tax codes, streamlining procedures and embracing technology must be matched by visible, fair enforcement to create a culture where all Kenyans see tax compliance as patriotic and beneficial.

On fiscal prudence and debt management, Mr Mbadi is rightfully cautious. The soaring wage bill, which threatens to crowd out capital expenditure, demands stringent controls, yet management of public sector-pay must remain sensitive to social contracts and political realities.

Phased payment of dues to unions, as Mr Mbadi advocates, reflects pragmatic problem-solving that balances fiscal discipline with labour relations.

Too often, fiscal austerity is misunderstood as across-the-board cuts. Instead, Kenya should focus on improving the quality of debt-favouring concessional and long maturity sources-and monetise assets strategically, channeling proceeds into sovereign wealth and infrastructure funds rather than filling recurrent budget gaps.

More aggressive restructuring of high-cost external debt, including innovative mechanisms like China’s conversion of Kenyan debt to renminbi, could provide fiscal space without jeopardising credit ratings.

Greater transparency in debt reporting coupled with independent external audits will also reassure investors and citizens.

The planning dimension Mr Mbadi advances through the public planning bill is commendable, fostering an evidence-based, synchronised budgeting process aligned across national and county governments.

Still, this reform needs clear implementation timelines, capacity upgrades and monitoring frameworks to translate law into practice effectively.

Without this, the bill risks becoming a well-intended but underutilised tool.

Arguably the most pressing challenge for Kenya’s development is its demographic profile. Mr Mbadi’s policies must therefore go beyond conventional employment creation to include robust investments in education reform that focus on skills relevant to evolving labour markets.

Moreover, the social dimensions of unemployment-mental health challenges, disillusionment and social instability-require integrated approaches linking economic and welfare policies.

The Treasury could explore social impact bonds and other innovative financing methods to fund youth-focused social programmes.

Comparative analysis with Thailand’s management of its Asian Financial Crisis in the late 1990s provides valuable lessons. Thailand faced sharp currency depreciation, banking sector collapse, high recessionary pressures, and social hardship-paralleling Kenya’s current fiscal stress marked by elevated debt ratios and external vulnerabilities.

Thailand succeeded by implementing rigorous fiscal consolidation, deep financial sector reforms, transparent governance, and fostering private sector dynamism, while cushioning social effects with employment support programmes. Kenya’s trajectory may well benefit from adopting a similar comprehensive approach.

To achieve these ambitious objectives, Mr Mbadi must fast-track the operationalisation of reforms, moving beyond policy statements to demonstrable actions with clear milestones.

In conclusion, while Mr Mbadi’s priorities provide a robust framework, their success hinges on deepening reforms, fast-tracking implementation, embedding youth empowerment and balancing competing demands through transparent governance and inclusive participation.

Asset financing company M-Kopa is now exporting 15,000 locally assembled mobile phones to Uganda every month, which is 10 percent of the 150,000 devices it produces monthly at its Nairobi assembly plant.

The company’s output at the Nairobi assembly plant has increased 25 percent from the average 120,000 units it was assembling monthly as of October last year, and the Uganda shipments are part of a strategy to lower operational costs and, in turn, reduce customer defaults.

M-Kopa says it aims to increase exports to Kenya’s western neighbour in the coming year and meet demand before exploring the possibility of setting up a local assembly there.

It began shipping to Uganda in the third quarter of 2024 with a trial shipment of 1,000 phones as a strategy to lower costs, in contrast to selling similar devices manufactured in China, which are subject to a 10 percent import duty, increasing the cost of the devices.

‘While we operate an independent unit in Uganda, we have not set up an assembly plant there because the output does not justify it yet,’ M-Kopa’s Kenya general manager, Martin King’ori, told the Business Daily.

‘We’re supplying them, and once the numbers are higher, there is a possibility of setting up there.’

Kenyan-made devices are exempt from import duty in Uganda because the East African Community (EAC) Common Market Protocol waiver tariffs on goods manufactured within the region.

M-Kopa sells these branded phones alongside other devices by manufacturers like Samsung on a hire-purchase basis under a pay-as-you-go (PAYG) model. A customer pays a deposit and repays the remaining amount in daily, weekly or monthly instalments. The phone is locked if they default on their payment.

As per its website, the company has three M-Kopa and seven Samsung models on sale, although their prices are not listed.

M-Kopa began assembling smartphones locally in January 2023, after Kenya introduced a 10 percent excise duty on imported phones onto the already existing 25 percent import duty, which would significantly raise the cost of the devices.

It partners with HMD- the Finnish manufacturer of Nokia phones, to locally assemble M-Kopa-branded smartphones and some Nokia-branded models.

This has made it one of the two major companies assembling phones locally alongside East Africa Device Assembly Kenya- a Safaricom-led consortium based in Athi River.

Mr Kin’gori said M-Kopa has shelved assembling phones for other companies ‘until we feel like we fully meet our own demand in the East African region.’

To date, M-Kopa has assembled over two million devices and begun refurbishing phones for the local market.

‘About 10 percent of the smartphones sold in Kenya in the eight months to August 2025 alone were refurbished units,’ he said.

M-Kopa said it has crossed two million customers for its free health insurance coverage it has bundled into its branded phones in partnership with Turaco Insurance since January 2024. The cover pays out Sh1,000 for every night spent in a public or private hospital.

The 2025 disclosures came after the UK-headquartered firm reported turning a net profit of Sh1.2 billion for the first time last year, after making losses since it was founded in 2010.

Tax base expansion plays a dual role: improving tax equity by raising revenue while reducing the overall burden. Kenya’s tax policy borrows from the OECD’s minimum rate benchmarks, including Significant Economic Presence rules. The OECD further identifies three pathways that support business sustainability-strong institutions, direct support, and hybrid policy designs.

In Kenya, KRA and the Business Registration Service (BRS) anchor taxation and licensing. The adoption of the UK Companies Act in 2015 marked a major step in deregulation, boosting the formation and visibility of local start-ups across supply chains.

Direct support involves building ecosystems that help businesses move from incubation to industrial stability through financing, training, mentorship and access to market information.

Without timely information, however, incentives can deepen market asymmetry, allowing large firms to dominate. Tax rebates such as Industrial Deduction Allowances, though powerful, tend to benefit large investors with access to high-level advisory services and the capacity to recover tax credits tied to heavy capital expenditure.

Financial institutions remain essential to enterprise growth.

Banks like KCB and Ecobank have intervened in dairy value chains, clean energy for schools and cottage industries, and gender-responsive credit programmes. Yet a closer look at Ecobank’s operations shows stronger investment footprints in West Africa than in Kenya-an indication that local banks must scale up support for home-grown projects.

Comparatively, the BRS Registry holds millions of dormant firms created mainly to access state tenders, only to be derailed by policy inconsistencies.

Botswana offers a contrast, with a successful hybrid model of part-grant, part-loan financing, predictable tax bands and the kgotla culture of public consensus-building. Corruption does not stifle start-ups at infancy.

Kenya, by contrast, frequently alters tax policies. From January 2026, all individual tax-deductible expenses must be validated on iTax-a shift that will increase audit and filing costs for SMEs. Even so, Kenya retains stronger market frontiers than Botswana.

To borrow from Barack Obama, the climb may be steep, but it leads to a better place. KRA must find the right policy mix to turn Kenya’s diversity into a stronger, expanded tax base.

NCBA Investment Bank has launched two offshore special funds for investors seeking exposure to international markets, joining other wealth managers that have introduced similar products that are popular with high-net-worth investors.

The company has joined other firms offering international market exposure including Standard Investment Bank (SIB) with MansaX and Faida Investment Bank with its OAK special fund.

The NCBA Global Equity and Fixed Income Special Funds will enable savers seeking long-term diversification to access international markets through a regulated, dollar-denominated structure.

The funds offer access to a wide range of global assets, allowing for diversification beyond traditional Kenyan unit trusts.

‘These [funds] invest in assets around the world and nothing to do with Kenya, and the genesis of them was to help our clients diversify and have exposure to the global markets in a way that is safe. We are not trying to take risks but manage their money in a diligent and trustworthy way in order to earn a good return,’ said Muathi Kilonzo, the managing director at NCBA Investment Bank.

The firm is looking to tap about 6,800 high net worth individuals, its diaspora clients and corporate customers engaging in international trade, with a minimum entry of $1,000 (Sh129,500) for each of the funds.

The funds rely on Exchange-Traded Fund portfolios that draw exposure from the United States, Europe, Asia and emerging markets.

‘We’re utilising our global presence, market knowledge and expertise to create a solid offshore investment setup.

Our goal is to ensure it meets all regulatory standards in various markets and truly connects with our clients’ needs, helping them invest their capital safely while aiming for reliable returns,’ Mr Kilonzo said.

‘It was client demand. Our clients were asking us to start giving them a diverse bouquet of solutions, people wanted to invest outside Kenya and diversify, we are doing so elsewhere but they wanted a brand like NCBA to give them a solution.’

Fund managers have been keen to introduce and grow special investment schemes that typically charge higher fees, compared to traditional investment assets as more Kenyans seek to diversify their portfolios beyond the local equities and fixed income assets.

A special fund is a type of a collective investment scheme that invests based on a fund manager’s strategy, and largely covers non-traditional assets such as real estate, private equity, offshore stocks and commodities.

The creation of the special funds has allowed fund managers to not only earn higher returns for clients from non-traditional assets such as offshore instruments but also helped them raise their fee income.

Total special funds’ assets under management touched Sh113.3 billion at the end of June this year, according to the Capital Markets Authority.

The dramatic weakening of the shilling to record lows seen in January 2024, is among the reasons that have drawn investor interest in assets denominated in hard currencies.

If you work in infrastructure, finance, or the wide grey zone between the two, you already know that big ambitions die quietly without the right partnerships.

In markets like ours, capital doesn’t move just because a project or an idea is brilliant, it moves because risk is understood, shared, mitigated, and sometimes nudged along by those brave (or stubborn) enough to insist that African markets can, and should, finance their own growth. Period.

That is the work Dhamana was built to do. And on November 18th, we proved it.

Dhamana announced its first guarantee-backed transaction: a KES 2.5 billion (~ USD 20 million) financing arrangement to solarise and hybridise Safaricom’s base transceiver stations across Kenya. This multi-party deal brought together Ofgen (the project developer), Safaricom (the off-taker), Middle East Bank (initial lender), Absa (takeout financier), and Dhamana as the guarantor enabling the entire structure to happen in local currency.

It’s one of the largest telecom modernisation and solar-hybridisation efforts in East Africa, and it isn’t just a clean-energy win, it’s proof of concept that local capital can support climate-resilient infrastructure when risk is intelligently mitigated and aligned.

In the words of our CEO Christopher Olobo, ‘Guarantees serve as an essential link between aspiration and investment. transforming a technical solution into a viable local-currency project that domestic capital providers can support confidently.’

He’s right. And this confidence shift is exactly why Dhamana exists.

So, why partnerships matter and why Dhamana is built on them? Infrastructure takes a village. A very technical, capital-heavy, risk-sensitive village. Partnerships are not mono, they are the operating system.

When people ask, ‘What’s the right time to pursue partnerships?’ the real answer is, before you think you need them. Partnerships work best when they’re not a last-minute fix, but part of the design.

At Dhamana, partnerships are foundational. Our shareholders are themselves evidence of what strategic alignment looks like. PIDG’s project development arm – Africa (InfraCo) have helped set up InfraZamin in Pakistan, InfraCredit in Nigeria, and supported GuarantCo across multiple frontier markets, institutions that have unlocked billions for infrastructure and proven the viability of guarantee models in tough environments. Our establishment for the East African market was the logical next step.

CPF Group, a local county pension fund and one of Kenya’s strongest advocates for local-currency investment, has been instrumental in pushing the conversation on domestic capital mobilisation.

And that conversation matters. Pension funds in Kenya, Uganda, and Rwanda collectively hold roughly USD 30 billion. Yet less than 10% is allocated to infrastructure, and even that is often untapped. We like to talk about ‘mobilising domestic capital,’ but let’s be honest, it’s hard to mobilise money that is allergic to risk. And pension funds are risk-averse for good reason, they hold you and I’s money, the life savings of millions.

But sometimes the biggest risk is the perception of risk. On the 18th November at Dhamana’s LC Investments event, CPF Group’s CEO Dr Hosea Kili accurately described it, our markets suffer from ‘risk inertia’, a reluctance to change our assumptions even when conditions evolve. Partnerships help break this inertia. Guarantees help break it faster.

As East Africa’s local-currency infrastructure guarantor, Dhamana sits precisely in that uncomfortable space between opportunity and hesitation. Our job is to create enough confidence for domestic capital to enter sectors it traditionally tiptoes around.

In this transaction, our guarantee de-risked a complex, multi-stage financing structure. By absorbing specific takeout and credit risks, Dhamana unlocked participation from Absa and Middle East Bank, both deploying local currency and both reducing exposure to FX volatility, which has quietly killed many well-meaning projects across the continent.

More importantly, this is replicable. As Absa’s Vice President Andrew Awilly put it, this model has ‘potential for replication across Africa’ and replication is where transformation happens.

The African Development Bank’s participation in our establishment was, frankly, obvious. They’ve spent decades championing development finance, resource mobilisation, and the very mechanisms (like blended finance and partial guarantees) that we are now applying in East Africa.

Their approach has always been consistent: Reduce barriers, derisk markets, and crowd in capital.

With the AfDB, the conversation has never been about charity, it’s about scale. It’s about getting African institutions to trust African opportunities. And for a guarantor like Dhamana, that alignment is invaluable.

The hurdles are real. But so is the opportunity. East Africa has the capital, the appetite, and the ambition. Dhamana’s work sits directly in that gap, helping shift markets from ‘risk inertia’ to informed confidence.

As Partnerships and Communications Officer, I see every day how partnerships reshape mandates. They enable, they contribute, they amplify. They move us from talking about potential to structuring it, financing it, and delivering it.

And if this first deal is any indication, East Africa’s infrastructure future will not be defined by hesitation…it will be defined by collaboration, boldness, and the insistence that local solutions deserve local capital.

Because when partnerships are intentional, aligned, and built on actual needs, they don’t just support a mandate…they move it forward.

Kenya is expected to establish a dedicated national e-commerce regulation unit as part of sweeping new regional rules, aimed at harmonising digital trade across eastern and southern Africa and improving consumer welfare in fast-growing digital markets.

The Model E-Commerce Policy for the eastern and southern Africa and Indian Ocean regions recommends that every member state creates a National E-Commerce Unit to coordinate regulation, oversee digital marketplaces and streamline policy implementation.

The proposal marks a shift from the current trajectory in Kenya, where legislation is underway to place the entire industry under the Competition Authority of Kenya (CAK), the country’s main consumer protection agency.

Experts from 29 countries under Comesa, the East African Community, Southern African Development Community , Inter-Governmental Authority on Development and the Indian Ocean Commission (IOC) endorsed the new proposals at a meeting in Nairobi on Monday.

Currently, most countries, including Kenya, rely on multiple regulators such as communications authorities, competition agencies and data protection offices to police online commerce. The policy argues that this fragmentation weakens enforcement, slows cross-border trade and creates uncertainty for businesses.

‘Findings show fragmented governance, overlapping mandates, weak enforcement, and limited coordination with private sector and civil society,’ reads the proposed policy.

‘Recommendations include establishing national e-commerce units, developing harmonized laws, enhancing coordination, strengthening consumer protection, and ensuring policy alignment across regional economic communities.’

If adopted, the reforms could reshape how Kenya regulates online marketplaces, digital payments, advertising, refunds, complaints and platform dominance – areas that have expanded rapidly but lack a unified oversight mechanism.

CAK is currently seeking amendments to the Competition Act to give it sole authority over e-commerce and digital markets, a move local experts warn could stifle innovation.

Comesa, which coordinated the development of the regional policy, says countries will be free to choose where the new units are housed – within communications regulators, competition watchdogs or State ministries.

‘At the national level, there are a lot of dynamics, so we can only recommend, but the choice and the decision is ultimately that of the member States,’ said Benard Dzwanda, Comesa’s director of infrastructure and logistics.

CAK could therefore create an additional department to handle e-commerce and digital trade, drawing expertise from data protection and communications agencies, or a fully separate entity could be established.

Kenya is currently consulting on its draft National E-Commerce Policy, which does not explicitly provide for a national e-commerce unit.

The new regional framework increases pressure on Nairobi to revisit its approach as it advances the next phase of digital-economy reforms.

If the government adopts the recommendation, Kenya would join other member states expected to reconfigure their regulatory systems to meet the standards set out in the model policy.

The State-owned Pyrethrum Processing Company of Kenya (PPCK) remains trapped by a Sh3.5 billion debt after a failed asset sale derailed the restructuring plan meant to clear long-standing financial obligations.

The aborted disposal was intended to unlock part of the firm’s Sh6 billion asset base, but delays during the transition from the defunct Pyrethrum Board halted the process before any assets could be sold.

At a Senate session last week, Agriculture Cabinet Secretary Mutahi Kagwe said that the liabilities include supplier arrears and staff pensions accumulated over several years of institutional decline.

‘The debt portfolio is some Sh3.5 billion, and this debt is essentially owed to suppliers and staff pension.. The organisation has an asset portfolio of about Sh6 billion, so it is possible for us to cover the debt once we sell (the assets),’ said Mr Kagwe.

‘The process of doing so hit a problem at some point. The movement from the original company to this organisation, the transition period, the valuation of those assets and so on and so forth, delayed everything about the sale of the assets.’

CS Kagwe said that payments to farmer remain outstanding to the tune of about Sh10 million for flowers delivered between August and October this year, highlighting the processor’s fragile cash position.

Historical delays in payments remain a major cause of farmer quitting, with the Mr Kagwe observing that people stopped farming pyrethrum because they were not being paid on time, weakening production across key counties.

The halted assets sale prevented the company from cleaning its balance sheet, making it unattractive to investors and preventing it from rebuilding a consistent working capital for processing and farmer advances.

The debt crisis has intensified strain within the pyrethrum value chain, undermining confidence in a crop that was once central to Kenya’s position in the global natural insecticide market.

Overall output remains well below potential, limiting Kenya’s ability to supply markets that demand natural insecticides in the wake of restrictions on synthetic pesticides in multiple jurisdictions.

The CS revealed that he has drafted a memo to be presented to the Cabinet, proposing that the handover of the company to private management once the debts have been cleared and valuations updated.

To this end, a fresh valuation will be conducted to reactivate the disposal plan. Mr Kagwe noted that the previous valuation no longer reflects current asset values.

‘The only way, in our view, in terms of policy structure that we can have a future within the pyrethrum sector is to involve the private sector,’ Mr Kagwe told senators.

‘There’s a Cabinet memo at the moment, which I have done, and we’re working with the Treasury to see whether we can go into leasing of the Pyrethrum Processing Company of Kenya. Once Cabinet agrees that we lease the organisation, we will need to go through the entire valuation of the assets again.’

A few years ago, I was walking by the poolside at the Muthaiga Country Club to my table, when I spotted my dear friend Bob Munro, (now deceased). He was there with his family and with his friend Michael Hopkins, to whom he introduced me.

Since then, Prof Hopkins and I became close friends as well, but equally sadly he too passed away recently- a few weeks before his eightieth birthday.

For the last few years, Prof Hopkins had been living part of his time in Malindi, part in Nairobi and part in France near the Swiss border, in each location continuing to pursue his passion for corporate social responsibility (CSR), where he had been a pioneer in developing sustainable frameworks.

He authored numerous books on the subject, including periodic updates, and he was also a visiting professor at many universities, including Management University Africa here in Nairobi.

He also published a series of blogs, condemning the awfulness of Brexit, which he later collected into a book called Brrrexit!.

Prof Hopkins was greatly in demand for interacting with students on the highly topical subject of sustainability, as well as with corporates around Europe, in India, Mauritius and elsewhere. He was also in demand with me, as he became my guide on CSR and sustainability, plus the closely related ESG issues – on Environment, Social and Governance.

I particularly admired him for his ‘systems thinking’, urging those with whom he interacted to integrate their ESG strategies with their overall ones. And another point he liked to make was not to confine CSR activity to the for-profit private sector but also to not-for-profits and to the public sector. Great thoughts! Plus to have sufficient but not excessive regulations for it.

I quoted him in a couple of my articles on such subjects in this column, and we participated in a joint book launch at the Westgate bookshop, he-with his CSR volume, ‘From the Margins to the Mainstream’ and I-with a collection of my articles on ESG.

Prof Hopkins and I linked up in several other related ways. He introduced me to Prof Mike Saks, his UK colleague who also specialised in such fields, and the three of us co-founded the UK-centred International Responsible Leadership organisation, which promotes such kind of leadership around the world.

Prof Hopkins may have been a much-respected academic in his field, but I don’t think I’ve ever come across such a jolly fellow, whose laughter so often filled the room.

He was a joker, not least about himself, and he and I would always have such a happy time together, whether just on the phone or in person.

His jolliness, his very firm values and his areas of interest also led me to introduce him to my Rotary Club of Nairobi, where he would nudge us into building sustainability into our community projects. Not surprisingly, his commonest phrases were to ‘treat others the way you want them to treat you,’ and to ‘treat all key stakeholders responsibly’, very aligned with Rotary thinking.

Prof Hopkins became a very popular member, often staying behind after our weekly lunch meetings to chat further, with a few members. And when he passed away, a great sense of sadness swept over the club.

Just recently Rosemary Wahome, herself in the sustainability business, asked me if I’ve thought about how to honour Prof Hopkins contributions to sustainability, and it immediately occurred to me to propose a sustainability award in his memory to our Rotary Club. Discussions on this are under way.

On November 16 – Prof Hopkins’ 80th birthday – a memorial service was held in Malindi to celebrate his life, with his son William and daughter Eve present.

And following this, his cremated remains were carried out on a boat and sprinkled into the Indian Ocean. Unfortunately I couldn’t be there to eulogise my buddy, but happily I have this opportunity to write about him.

We will continue learning from Prof Hopkins about CSR and sustainability through his writing and remembering what he taught us, and it will keep reminding us of his permanently on-display sense of humour and his jolly laughter.

The battlefields of 2020s and beyond are currency corridors, energy chokepoints and strategic resource chains. The economy is not a parallel theatre; it is the theatre.

The most serious threats to Kenya today do not just wear boots, suicide vests or carry rocket-propelled grenades, cross borders, or announce themselves on intelligence advisories.

They arrive quietly – through markets, cables, grids and pin-stripe suits wielding contracts and commercial agreements we clap for without reading the fine print.

Modern power doesn’t storm the gates; it buys the land around the fortress until the fortress is an island. It builds a moat around the resource, not to protect but to exploit it. We have already been warned by reality, more than once.

When our Eurobond yields shot up and rolled us into an expensive corner, it wasn’t simply a ‘market reaction.’ It was a lesson: sovereignty can be squeezed through interest rates and access to capital. Financial pressure is a form of state pressure.

We negotiated, refinanced, extended, repackaged – but beneath the financial engineering was a truth we didn’t say out loud: our economic flank is exposed, and exposure is a security issue, not just a fiscal one.

It doesn’t help that Kenya is still lurking in the dark corridors of anti-money laundering and counter terrorism financing grey list globally; the implication isn’t just enhanced scrutiny on financial transactions and increased cost of compliance – it is a strainer on inbound capital itself.

A potential reason for capital flight.

Then the lights went out – repeatedly – and not in remote corners of the republic, but at the nerve centres of our economy. Nairobi went dark. Jomo Kenyatta International Airport fell silent, runways dead, terminals lit by backup systems not designed to carry a nation’s reputation.

The grapevine on internet platforms like X (formerly Twitter) about the reasons for such wide-sweeping blackouts has not helped Kenya’s reputation either. No foreign adversary needed to test our airspace; the country demonstrated, unprovoked, how to bring itself to its knees.

Multiple times. It should never take more than one airport blackout for a serious state to update its doctrine on energy as a national security asset. It is an opinion that having Kenya Power Company as the only national utility scale power distributer is a national security concern in itself.

Our mineral story – or more accurately, our mineral habit – is another window into how casually we treat the assets that the world considers strategic. In a century defined by rare earths, lithium, cobalt, niobium and graphite, we still sign mining licences as if they are real estate leases.

Other nations treat those resources as bargaining chips for their future industrial capacity. We treat them as ribbon-cutting opportunities. The difference is philosophical, not administrative.

It is the difference between seeing minerals as revenue and seeing them as leverage. It is now out there, global powers like China and the US showing a keen interest in our rare earth reserves, estimated to be worth about two thirds of our current debt stock, about $62 billion.

Minerals licences are not merely commercial instruments; the world treats them as geopolitical assets. Mrima Hills is certainly atop US Vice President JD Vance’s agenda when he visits. We will concede ground, given the president’s blunder in foreign relations with former Us President Joe Biden. But what will we get in return for the conceded ground? Or perhaps, forgone revenue?

There will be national security consequences to this – but econnomic in nature and may fly over the heads of the current state bureaucrats.

Instead of allowing a non-exploitation concession on the rare earth elemsnts, we could get into a mutually beneficial relationship into building a rare earth refinery – setting us up for major defence, space and global electronics supply chain race.

The economic multiplier around that would be able to inject over $240 billion into the Kenyan gross doemstic product over the next 10-15 years and creating thousands of jobs in the process. That is a strategic national security imperative.

When you look beyond us, the Nord Stream sabotage in Europe didn’t just destroyed two pipelines; it rewired the continent’s entire thinking about energy, alliances and vulnerability.

China’s export controls on rare earths, gallium, germanium and advanced battery technology weren’t mere trade decisions – they were strategic manoeuvres, to remind the world that controlling supply chains can be more decisive than controlling armies. Energy and minerals are now geopolitical instruments. This is not theory. It is the operating system of modern power.

In Kenya, we have structured our national security imagination as if the only legitimate threats are those that can be confronted in uniform. Defence, intelligence and policing remain vital pillars – but power has migrated, and our thinking has not caught the flight. As it stands, we have perfected exceptional talent in mastering structure instead of leverage.

So what would a state that actually intended to keep its future look like?

A serious republic would not design a national security architecture that excludes the custodians of its currency, its energy lifelines and its economic bargaining chips from the core of strategic decision-making. You cannot defend a country’s sovereignty if the stewards of the economy and the stewards of the energy system sit outside the room, where security strategy is defined.

Imagine a small, concentrated office: an advisor who is not ornamental but obligatory, whose job is not to whisper in corridors but to convene the minds that can translate risk into plan, and plan into executed contingency.

Imagine Treasury on the core panel of security decisions because finance is where coercion often begins.

Imagine Energy at the table because when the lights go out, the social contract frays faster than the printed slogans in our press conferences. Imagine a requirement – not a suggestion – that any strategic concession, infrastructure contract, or cross-border asset transfer arrive with a security-impact assessment and a mitigation plan.

You manage risk by naming it, by assigning authority, and by making failure expensive and public. The alternative is improvisation in the teeth of catastrophe, and improvisation is the luxury of those whose options have not yet been exhausted by miscalculation.

A state that confuses the comfort of ceremony, with the rigor of preparedness is a state that will discover its limits in messy, irreversible ways. Put Treasury and Energy into the National Security Council by law. Institutionalise a National Security Advisor to integrate defence, intelligence, finance, energy, cyber and minerals.

This is not bureaucratic cosmetics. It is how sovereign states survive the century. National security is no longer a uniformed domain – it is a whole-of-state discipline. It requires a mind at the centre that integrates defence, intelligence, economic resilience, energy stability, technological sovereignty and resource strategy into a single national posture. Many countries call that role a National Security Advisor.

We treat it as optional decor. A third-rate aide to the president, when this is the individual that ought to consolidate military, civilian, economic and energy intelligence into a presidential daily advisory brief.

The state must stand tall at all times as an organ of resilience. Regimes fail; the state must always endure. There is dignity in admitting that the world has changed, and Kenya must change with it or perish.

As Europeans started getting comfortable living in Kenya in the early 1900s, they gradually established private member clubs, where settlers would gather to enjoy games and to dine as they socialised.

After independence, the clubs shifted from being a whites-only affair, though the elites of the young republic maintained the traditions of their erstwhile colonisers.

Today, as some of the clubs mark a century of existence, there is the burning question of whether they are locking out the youthful populations through their pricing policies and the rules of engagement.

‘There are some clubs where most people are old generation and the young men have not come in,’ says Mr Felix Okatch, one of the directors at the United Kenya Club.

Mr Okatch, who has been a member of one club or another since 1983, says clubs should make it conducive for young people to join as they form the majority of the population.

‘I encourage young men to join, particularly those who have started business,’ Mr Okatch notes.

Private member clubs, which are designed to be a confluence point for the wealthy, exist for various reasons.

‘One benefit is social, where people of a class come together – those who are capable or the top cream,’ says Mr Okatch, who is also an author.

‘Over time, these clubs have developed facilities like golf, squash, cricket, lawn tennis, swimming pool, gym, and many more activities. The clubs also have bars, restaurants, accommodation, and some have apartments.’

The clubs also help businesspeople as they can be used to host crucial meetings.

‘You come with a car, you park, then you secure a deal,’ says Mr Okatch.

Another benefit is that a member of a club in one part of Kenya can travel to another part of the country and enjoy benefits of another club if the two have a reciprocating arrangement.

‘If somebody’s in Eldoret Club, he can go to Nyanza Club, to Nyeri Club, Mombasa Club, Kitale Club, and enjoy like the other [members],’ says Mr Okatch.

The clubs are also known for the strict rules they enforce. There are guidelines on the dress code, conduct within the premises, welcoming guests, among others.

In a number of the clubs, making a phone call in some spaces can earn someone a fine. Some do not permit wearing a cap in some areas while others prohibit donning denim clothing. A collarless T-shirt is hardly allowed in most clubs, as are sandals.

A recently determined court case, pitting lawyer Donald Kipkorir against the Muthaiga Country Club, revealed how stringent some of the requirements can be. Mr Kipkorir was denied entry at the club in August 2024 on various grounds.

Mr Kipkorir later sued the club, saying the manner in which he had been turned away went against his right to dignity as no sufficient explanation was given.

The court heard that the lawyer visited the premises to meet his clients who are members of the club. However, on that day, he was denied entry. The club argued that it reserved the right of admission, noting that even though its more than 6,500 members are free to invite guests, its by-laws prohibit admission of non-members who are not in reciprocating clubs.

The club said an earlier incident in October 2022, where the lawyer was also denied entry but later allowed in, informed their decision.

Mr Kipkorir said he was treated ‘like a stray dog, a homeless hound that had trespassed on the hallowed grounds of the privileged elite’. A Nairobi court agreed with the lawyer’s arguments and awarded him Sh1 million in damages.

With strictly enforced laws and an old guard not willing to depart from the traditional way of doing things, younger Kenyans in the private clubs ecosystem have sometimes been dismissed as lowering the standards. A former chairman of a private club who spoke with Nation Lifestyle held this view, though he did not wish to share his remarks on record.

We spoke to Jessy Ndegwa, the chairman of the Ruiru Sports Club, and asked him: ‘Is your club doing enough to attract younger members?’

He was candid enough to admit that there are no products targeting youth of 35 and below.

‘However, this being a family-oriented club, we have conversions from junior members to single members. And we have a lot of those. When you have a family [package], the club allows your children to transition to single membership after 25 years. So, what we have, we don’t let go of. We encourage them to graduate and take responsibility for their own membership,’ he says.

Graduating junior members to the senior category after the age of 25 is a common phenomenon in private member clubs across the country. The Wadi Degla clubs-Kenya, a recent entrant in the space, also considers 25 as the age when junior membership ends.

‘They will only pay a subscription [upon converting to single members]. They will not pay entry fees,’ says Mr Ndegwa.

To obtain family membership at the Ruiru club, one needs to pay Sh600,000. To become an individual member, on the other hand, one needs to pay Sh450,000. On top of the membership fee, a member of Ruiru Sports Club should pay an annual subscription fee of Sh24,000 for the family package and Sh16,000 for the individual package.

That isn’t too far from what other clubs charge. As per the last published rates online, the Royal Nairobi Golf Club that has been in existence since 1906 charges a joining fee of Sh595,000 and an annual subscription of Sh61,460.

The Parklands Sports Club, which will be 120 years old next year, charges a full member admission fee of Sh775,000.

The United Kenya Club, on the other hand, charges Sh150,000 to admit a member living in the city, with a Sh20,000 annual subscription required.

Asked whether the fees are too high to discourage younger Kenyans, Mr Ndegwa says: ‘True and not true.’

He notes that besides the option of juniors graduating to full members after their 25th birthdays, there are occasional membership discounts that prospective signees can grab.

‘Sometimes we have [recruitment] drives. So, for those who want to join and they do not have resources right now, I encourage them to keep looking out for when we have drives. And during drives, sometimes we give up to 50 percent of the classes that we present to potential members,’ he says.

A top contributor to younger Kenyans joining private clubs is the fact that some corporates have been buying membership for some of their staff.

Mr Okatch, who is a marketer by profession, joined his first club because his employer paid for it.

‘The aim then was for me to meet people who matter in business circles. In the club, there was encouragement for me to play golf as my children were busy enjoying swimming and other things,’ he says.

The United Kenya Club, where he is a director, has a package for corporate membership where a company can pay Sh650,000 to admit up to five employees. This is followed by an annual subscription of Sh100,000 for the members.

The thinking behind some employers getting their staff in such clubs, he says, is to give them access to potential clients.

‘It’s not to sell your product, but to meet the who-is-who. It opens ways for you to get into the marketing field,’ argues Mr Okatch. ‘Corporate organisations can pay for their members up to Sh1 million.because you meet those who matter.’

Dr Mike Iravo, a specialist in human resources management and a lecturer at the Jomo Kenyatta University of Agriculture and Technology, says there are many benefits that an employer gets from buying club membership for an employee.

He adds that such an arrangement can improve “productivity, motivation, among many other things that an individual employee would benefit [from]’.

Asked what portion among the 2,800 members of Ruiru Sports Club were brought in by corporates, Mr Ndegwa says there is less than five percent. He attributes this to the fact that Ruiru has not been widely known.

‘Ruiru, until recently, was not known in the circles of clubs. The clubs that were known were Muthaiga, Karen, Limuru, and Sigona,’ he says, noting that the club – which sits on 235 acres of land – is currently on a rapid expansion drive, driven by a 45-year masterplan.

The benefit a corporate gets by buying club membership for staff, Mr Ndegwa says, is that it gets ready buyers.

‘Being a member, knowing that you are going to interact with these people day in, day out, every other week, gives you an opportunity for people whom you would not have spoken to if you met in the streets just like that. But in the evening here, if you join a table, you join as a member and it is very easy to start a conversation. And they already trust you and you already trust each other,’ says Mr Ndegwa.