Kenya has abandoned plans to privatise facilities run by the Kenya Ports Authority (KPA), opting instead to convert the parastatal into a Public Limited Company (PLC) under the newly enacted Government Owned Enterprises (GOE) Act.

For five years, the government had sought to privatise the Mombasa and Lamu ports to boost efficiency, but the initiative failed to take off.

The proposed scheme, billed as the largest privatisation in Kenya’s history, saw KPA issue tenders inviting global firms to partner with local companies to run Lamu port, a section of Mombasa port, and the Lamu Special Economic Zone (SEZ).

Under the plan, sections of the ports were to be leased to private operators under a landlord-style management system, aimed at enhancing competitiveness along the Northern Corridor. Any international bidder was required to form a joint venture with a Kenyan firm holding at least 15 per cent of the project company.

Mr Chirchir explained that the GOE Act, assented to on 21 November 2025 and effective from December, reforms state-owned enterprises into commercially driven, self-sustaining public companies under the Companies Act.“The law replaces the State Corporations Act with a framework focused on profitability, accountability and, in some cases, minority shareholder representation on boards,” he said.

The Act reorganises 66 commercial entities to operate as businesses rather than government departments, with dividends channelled to the Exchequer. It also separates ownership roles between the National Treasury and line ministries, establishing a performance-based framework.

It applies to entities where the government holds more than 50 per cent of share capital, converting them into limited liability companies to strengthen efficiency and transparency.“The GOE will be a game changer, allowing organisations like KPA to be run on private-sector principles. It streamlines governance by separating policy oversight from operational management, tightening accountability and accelerating decision-making,” Mr Chirchir said.

He added that KPA now has powers to acquire equipment to ease congestion and handle rising cargo volumes at Mombasa and Lamu. By adopting a PLC structure, authorities hope to align terminal performance with throughput growth while safeguarding trade flows and investor confidence.

Rapid procurement is seen as vital to protect Mombasa’s reputation as East Africa’s leading shipping hub.

The governance shift comes as the port continues to post strong results. In 2025, Mombasa handled 45.46 million tonnes of cargo, up from 41 million tonnes in 2024, underscoring its role as a critical gateway for Kenya and landlocked neighbours including Uganda, Rwanda, South Sudan and eastern Democratic Republic of Congo.

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