Kenya is set to establish a legal framework to safeguard part of its future oil and mineral wealth, ensuring that earnings from these resources benefit generations yet to come.
A new law before Parliament aims to prevent all revenues from being spent immediately, instead setting aside a portion for long-term investment.
The Sovereign Wealth Fund Bill, 2026, introduced by Majority Leader Kimani Ichung’wah, mandates that a minimum of 10 per cent of all petroleum and mineral revenues be reserved for future generations.
This approach guarantees that at least a fraction of the country’s natural resource income is preserved rather than consumed in current budgets.
According to the Bill, all proceeds from oil and minerals will first be deposited into a central account. From there, funds will be divided among three distinct components of the sovereign wealth fund, one of which is specifically designed for future generations.
The legislation highlights that the fund will be “managed and invested for the benefit of current and future generations of the citizens of Kenya,” establishing a clear mechanism for long-term savings. This component is tightly controlled, with strict limits on access to ensure it is not used for routine spending or development projects.
“Funds shall not be withdrawn or transferred from the Future Generations Component for any purpose except for investment,” the Bill states, effectively ring-fencing the savings. Beyond initial allocations, this component will also benefit from returns on its investments and a share of income from the other sections of the fund.
The law restricts investment options to ensure the money grows while remaining secure. It bars investing in local assets, including Kenyan securities, real estate, or companies primarily focused on Kenya. Instead, funds are to be placed in approved foreign instruments such as high-rated securities and deposits with international banks and multilateral organisations.
The Bill also outlines strict conditions for accessing these savings in the future, reinforcing its goal of protecting the funds until Kenya’s oil and mineral resources are nearly depleted. By setting these rules, the legislation aims to create a stable, long-term source of wealth for Kenyans who will inherit the country’s natural resources.