A fresh governance paper has entered the national debate on the proposed Kenya National Infrastructure Fund (NIF), arguing that structuring the fund as a corporate entity is not only appropriate but consistent with global best practice.
In a policy paper titled Kenya National Infrastructure Fund: Governance Structure and Corporate Model, Dr. Benard William Chitunga contends that concerns over the fund’s proposed corporate structure, including questions such as “Why is it corporate? Why is it privately incorporated? What is being hidden?”, reflect a misunderstanding of how sovereign and infrastructure funds operate globally.
According to the paper, governments around the world frequently establish sovereign wealth and infrastructure-focused funds as separate corporate or private entities rather than as direct extensions of government ministries. The rationale, it explains, includes operational independence, enhanced governance standards and the ability to pursue commercial objectives without excessive bureaucracy or political interference.
By functioning as private-like entities, such funds are better positioned to attract professional talent, implement market-driven strategies and mitigate risks associated with direct government control, including short-term political pressure and bureaucratic inefficiencies. The structure also allows them to invest in diverse assets, including foreign markets, while maintaining accountability to the state as the ultimate owner.
Global Models Cited
The paper highlights several international examples that Kenya could learn from:
- Temasek Holdings (Singapore), a private limited company wholly owned by the Singapore government, invests across multiple sectors, including infrastructure, and manages a portfolio valued at hundreds of billions of dollars.
- GIC Private Limited (Singapore), also structured as a private company, manages Singapore’s foreign reserves with significant allocations to infrastructure and real assets.
- Mubadala Investment Company (UAE), a corporate entity owned by the Abu Dhabi government, focuses heavily on infrastructure, energy and technology investments worldwide.
- Public Investment Fund (Saudi Arabia), operating as a corporate-like entity, drives major domestic and international infrastructure investments under Vision 2030, including renewable energy and logistics.
- National Investment and Infrastructure Fund (India), established as a private company with minority government ownership, leverages partnerships to attract foreign capital for roads, energy and digital infrastructure.
These models, the paper argues, demonstrate that corporate structuring does not diminish state oversight but instead enhances professional management and long-term investment discipline.
Long-Term Returns and Economic Stability
The governance paper notes that the corporate model has allowed sovereign and infrastructure funds globally to commit to long-term projects that generate stable, inflation-resistant returns while contributing to economic stability and growth.
For example, Temasek has achieved annualised returns of approximately 6–7 percent over decades, supporting Singapore’s economy through diversified global holdings. Similarly, Saudi Arabia’s PIF has used its structure to mobilise billions of dollars in private co-investment, particularly in green hydrogen and renewable energy projects, advancing economic diversification.
India’s NIIF, through independent governance, has successfully bridged public infrastructure projects with institutional capital, delivering both developmental impact and competitive market returns.
Globally, such funds now manage assets exceeding $11 trillion, often outperforming traditional asset classes while financing critical sectors including energy transition and logistics.
Conditions for Success in Kenya
While strongly endorsing a corporate structure for Kenya’s proposed fund, the paper stresses that governance safeguards will determine its success.
It calls for merit-based appointments to the board and management, zero tolerance for corruption, robust transparency mechanisms and strict adherence to the fund’s mandate and long-term vision.
Dr. Chitunga concludes that the Kenya National Infrastructure Fund “can and should be established as a corporate entity,” provided that integrity, professionalism and accountability remain central to its operations.
As Parliament and policymakers continue deliberations, the governance debate is likely to shape how Kenya balances development ambitions with public confidence in the management of large-scale national investment vehicles.
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