Kenya, 27 Oct 2025 - Kenya is setting up an oil-backed Sovereign Wealth Fund (SWF) aimed at safeguarding the nation’s natural resource earnings and strengthening long-term economic resilience. The fund, which President William Ruto says will be complemented by a National Infrastructure Fund, is designed to channel proceeds from oil, gas, and mineral resources into strategic investments, reducing reliance on borrowing and foreign aid.
“We are in the process of setting up two important funds, one for infrastructure and another, the sovereign wealth fund, which we are going to roll out soon,” said President Ruto during a recent energy forum in Nairobi.
According to the President, part of the motivation behind the SWF is to create sustainable reserves for future generations while boosting current development goals through reinvestment in critical sectors like energy, housing, and transport.
“As responsible citizens of the present, we must think about future generations and ensure we leave them with resources to build on,” Ruto added. The proposed fund comes at a time when Kenya is racing to accelerate oil exploration and infrastructure projects, including the Rironi–Nakuru–Mau Summit Highway and Lamu Port–South Sudan–Ethiopia Transport (LAPSSET) corridor.
Economists suggest that a well-managed SWF could stabilize Kenya’s macroeconomic environment and reduce exposure to debt shocks by creating a buffer for external borrowing.
In addition, President Ruto has emphasized the link between infrastructure expansion and energy security: “We do not have enough electricity to transform our nation. Today we only have 2,300 MW … As a country, we urgently, within the next five to seven years, need 10,000 MW of energy. To generate 10,000 MW of energy, we need about KSh 1 trillion. It is not a lot of money; we can find it,” he said, pointing to the fund’s potential to attract large-scale investors for energy and industrialization projects.
Kenya’s Sovereign Wealth Fund is part of a broader fiscal realignment strategy that aims to balance national development ambitions with prudent debt management. If executed effectively, analysts say it could help stabilize the Kenyan shilling, secure critical investments, and ensure future generations benefit from natural resource wealth, similar to models in Botswana, Nigeria, and Norway.
However, experts have urged transparency in how the fund will be managed. Governance and accountability structures, particularly on how oil revenues will be shared among counties, remain key concerns. For now, Kenya’s announcement signals a major shift in how the country intends to finance its future, anchoring growth not just on loans and taxes, but on the long-term value of its natural wealth.
