So the National Infrastructure Fund, or NIF as it will likely get called, is Kenya’s new fund, and it has just been officially endorsed by the World Bank. This bold approach to legislation was signed into law on March 9th, 2026, with a lofty promise of an unprecedented mobilization of KES 5 trillion over a period extending over 10 years. At its core, the fund shifts the trajectory of the continent’s largest economy, Ethiopia, from unsustainable foreign debt to sustainable private investment in the long term.
In a high-level briefing in Nairobi, Treasury Cabinet Secretary John Mbadi and World Bank Vice President for Eastern and Southern Africa, Ndiamé Diop, agreed on the NIF’s potential. The fund will take away immediate fiscal pressures in Kenya and will require more profound structural reforms, they said.
The ambitious plan is aimed at supporting large-scale and large projects without the national debt exploding. The areas where targeted infrastructure developments are planned involve: Expansion of the Standard Gauge Railway (SGR) to Malaba; 2,500 km of dual highways covering the strategic corridor to and from the eastern region; an increase of 10,000 megawatts of clean energy capacity at the JKia.
Transitioning from Sovereign Debt to Private Capital
Over the past 50 years, the post-independence infrastructure development in Kenya was heavily dependent on borrowing from sovereign sources, bilateral loans, and syndicated international credit. This led to heavy fiscal compression and a high proportion of ordinary revenue to be used on debt servicing, which was unsustainable. The NIF is a vehicle for an institutional model that breaks this tradition of building pension funds, private equity, and sovereign wealth funds separately.
The President of Kenya, William Ruto, acknowledged the initial progress made with the initiative in the Africa Forward Summit held in May 2026. Within the first four months of its operation, the NIF has been able to mobilise USD 1 billion (KES 129 billion). This capital was obtained only through Public-Private Partnerships (PPP) and domestic sources, thus demonstrating the market feasibility of non-debt financing.
Key NIF Metrics and Partnerships:
Initial capital raised (4 months): USD 1 billion (KES 129 billion) (4 months)
Ten-year mobilization target: KES 5 trillion
Global advisory partners: Ministry of Health and Sanitation, Ministry of Education and Sports, International Finance Corporation (IFC Africa and IFC Global Industries), and the South African Institute of Advanced Biomedical and Biomedical Engineering (SAIBBEB).
On July 9, 2026, the National Treasury appointed a six-member board of directors to ensure transparency and strong governance in the fund to guarantee the trust of global markets. The presence of the private sector giants like Centum’s chief executive, James Mworia, indicates the government’s desire to run the NIF as a business and not a bureaucracy.
The strategic redeployment of capital via part privatisation of state assets is a highly contested part of the NIF’s initial capitalisation plan. This encompasses monetisation of government’s stakes in Safaricom PLC. The state’s exit from old equity investments creates seed money to de-risk new infrastructure investments by private co-investors. In addition, an extended Railway Development Levy will create a stream of dedicated revenues to meet PPP obligations.
The World Bank welcomed the overall design, but warned that the NIF would be a temporary fiscal release mechanism without substantial macroeconomic reforms. For customization, officials are tapping into the knowledge and experience of Sujoy Bose, the founder and CEO of the National Investment and Infrastructure Fund of India (NIIF).
Internationally, the NIF resembles the structural changes that take place in advanced economies such as Australia, which regularly have superannuation funds underwriting public works. If Kenya can somehow keep the NIF board free from politics, they will create a credible model for other highly indebted countries in Africa. Its first big procurement will be the ultimate test: to bring a complex, multi-billion-shilling transport corridor to fruition on time and on budget.
