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FULL Speech: Ruto Reveals the KSh150 Billion JKIA Deal—Why Kenyans Won't Pay More Taxes. — Transcript

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0:06Thank you very much. Please let's take
0:08our seats asantana.
0:12Your excellencies, distinguished
0:15leaders, ladies and gentlemen. Good
0:18morning and welcome to this
0:21in my opinion very consequential
0:24ceremony this morning.
0:27There are moments in the life of a
0:29nation when history is recorded
0:34not in years
0:36but in months.
0:38In March this year, Kenya changed how it
0:42will finance its development
0:45to build the assets of the future
0:48through the National Infrastructure Fund
0:52that we brought into force.
0:55Today, Kenya changes again how it will
0:59preserve
1:00its wealth and its future.
1:04Today we enshrine
1:07in law the institution that will ensure
1:09that the prosperity
1:12of those assets we create endures for
1:15generations
1:18and that is the national
1:21sovereign wealth fund. Let me state the
1:25principle plainly because everything I
1:28say after this flows from it. If the
1:32National Infrastructure Fund builds the
1:35assets that grow our nation, the
1:38sovereign wealth fund preserves and
1:41multiplies the wealth the assets create.
1:45I know there was a question asked to the
1:48panelists. I must congratulate all the
1:50panelists who spoke here
1:54for their cander in explaining to us
1:58from their perspective, from the private
2:01sector perspective what they see in what
2:05we are doing as government.
2:08And the question was
2:11we have the national infrastructure fund
2:14now we have the sovereign wealth fund.
2:20What is the difference and what is the
2:22connection?
2:24In my very simple understanding
2:29the sovereign the the national
2:31infrastructure fund
2:34builds our present.
2:36You know very well
2:39that we have many projects,
2:44critical infrastructure
2:47that we are desirous of building as a
2:50nation.
2:53But
2:55on the other hand, we have limited
2:57resources on how to deliver on these
3:00very critical infrastructure projects.
3:03The National Infrastructure Fund creates
3:06the bridge
3:08between
3:10the infrastructure projects that we need
3:14for our growth and the resources
3:18that will unlock
3:20the capital for us to implement these
3:22projects.
3:26I will give you an example.
3:29We've just signed the contract for the
3:32um Jama Kinata International Airport.
3:36It's going to be a 150 billion shilling
3:39project.
3:43We cannot build that project
3:47using our budget because it's heavy.
3:52So, we will not borrow and we will not
3:55add additional taxes.
3:58What is going to happen is that we're
4:00going to use
4:0220 billion shillings of the money we
4:05raised under our national infrastructure
4:07fund to crowd in the balance of the
4:10money from the private sector.
4:14That is how innovation works in the
4:18transformation of a nation.
4:23That is why in our midst here we have
4:26fund managers,
4:27we have different investors,
4:30we have banks who are looking at the
4:34opportunity,
4:35pension funds who are looking at the
4:38opportunity to invest in Joo Kata
4:41International Airport.
4:45That is what NIF is going to do.
4:50But sovereign wealth fund
4:53will connect the investment we are
4:55making in Jama Kenata
4:58to the future
5:00generations.
5:03Because apart from benefiting from
5:07resources that will come
5:10from our natural resources in oil and
5:14minerals.
5:16We will also be investing
5:19profits
5:21that come from investment
5:24in our very critical infrastructure like
5:27JMO Kenyata in the sovereign wealth fund
5:30so that Lynn here and Ronny and the
5:35young ones that came to witness this
5:38signing can have a portion of the
5:43investments we are making today for
5:45their future.
5:48So this is the connection that we are
5:50making between
5:52the present
5:54and the future.
6:01These are not
6:03isolated
6:05milestones. They are successive chapters
6:09in the deliberate transformation of our
6:12republic.
6:14Over the past three years,
6:16the bottomup economic transformation
6:18agenda has restored stability,
6:22rebuilt confidence, strengthened our
6:26economy, and laid the foundations for
6:30sustained inclusive growth. With those
6:33foundations in place, we now transform
6:36how Kenya finances development,
6:39mobilizing domestic savings and private
6:42capital to build the assets of the
6:45future.
6:47But financing development is only half
6:50the journey. Today we ask a different
6:53question.
6:55What do we do with the wealth,
6:58the assets we are building today and the
7:00natural resources we are
7:04unlocking today? What are we doing about
7:07the future?
7:09Do we use it all
7:12in our lifetime or do we preserve part
7:15of it for so that future generations
7:19inherit not just what we found but the
7:24prosperity we created about with what we
7:27found.
7:29Our constitution answers that question
7:32long before we do. Article 201
7:36C provides that, and I quote, "The
7:41burdens and benefits of the use of
7:45resources and of public borrowing shall
7:48be shared equitably between present and
7:53future generations." End of quote.
7:57This is far more than a principle of
8:00public finance.
8:02It is a constitutional covenant between
8:06generations.
8:09Today, through the sovereign wealth
8:11fund, we give practical effect to that
8:16constitutional promise
8:19in front of our children.
8:23Natural resources are different from
8:26taxation or ordinary economic
8:28production.
8:30They are finite
8:32by their nature. Once a barrel of oil is
8:36extracted, it can never be extracted
8:39again. Once a mineral deposit has been
8:43exhausted, it is gone forever.
8:47If one generation consumes all the
8:49proceits from exhaustible resources,
8:53it leaves nothing but empty mines and
8:56depleted oil fields for those who come
9:00after.
9:02That is neither prudent economics nor
9:07responsible stewardship.
9:10Around the world, history offers
9:12powerful lessons.
9:15Kuwait began the journey in 1953.
9:19But perhaps the best known example is
9:22Norway as has been stated here which I
9:25had the privilege of visiting a few
9:28weeks ago
9:30and I sat across the table
9:33with a minister who
9:36was present 30 years ago when they
9:40started
9:41their sovereign wealth fund.
9:46And I had a real eyeball to eyeball
9:49conversation because I knew that shortly
9:53I will be signing Kenya's sovereign
9:56wealth fund.
9:58And just imagine what has happened in
10:00one generation.
10:04Norway
10:08has done something phenomenal.
10:12In one generation, in 30 years,
10:17they have built the world's largest
10:20sovereign wealth fund.
10:23$2 trillion.
10:28280
10:32$2.2 2 trillion
10:34$2 almost 80 trillion Kenya shillings.
10:41I mean in just 30 years. So when I tell
10:47our good citizens that we can be a first
10:51world country in one generation, it is
10:53possible.
10:57If anybody had any doubt in their mind
11:00what is achievable with focus, courage
11:04and determination, look at what Norway
11:06has done. Rather than consume all the
11:10wealth generated
11:12from its North Sea oil, Norway chose to
11:16invest for the future.
11:19Today, as I have said, its sovereign
11:22wealth fund is worth
11:24$2.2 2 trillion. It owns about 1.5%
11:30of all listed companies in the world
11:34with investments in more than 7,200
11:40companies
11:42across the globe including
11:45Equity Bank
11:48right here at home. 14% in James's own
11:52words.
11:56That is how transformation works.
12:02That is the power
12:04of disciplined investing and long-term
12:09thinking.
12:11Closer home, Botswana again as has been
12:14said here, build the Pula Fund.
12:18Pula means rain.
12:20In a dry land like Botswana, setting up
12:24a reserve is not an indulgence.
12:28It is a survival strategy.
12:32Rwanda has done the same.
12:34Many other countries have done so.
12:37Today, Kenya proudly joins that
12:41community of nations that saves while
12:44they built.
12:46The lesson from each of these nations is
12:49unmistakable.
12:51Natural resources
12:56create opportunity.
12:58Institutions determine destiny. Without
13:02the right institutions, even great
13:05national natural wealth can become a
13:08missed opportunity.
13:11Economists call this the resource curse.
13:16I dare say they give it the wrong name.
13:19The curse is not the resources.
13:23The curse is the failure in stewardship.
13:27Kenya has learned this lesson through
13:30experience.
13:32For many years, Kenya extracted titanium
13:35from the mineral sons of Kali.
13:39It was one of the largest mining
13:40investments in our country's history.
13:44The minerals were extracted.
13:47Those deposits can never be mined again.
13:52What answer shall we give one day
13:57to our children when they ask us what
14:00happened to Titania?
14:05That is why this legislation
14:09that today becomes law in Kenya is
14:12consequential.
14:15So that [applause]
14:20never again will we
14:23mine
14:25or use resources
14:28without a trace
14:31for the future generations.
14:33Kenya is expected and you have heard
14:36from Paul Russo to commence oil
14:39production
14:41from the Loitar basin in Turkana. For
14:44decades that discovery
14:48has represented hope. Today it also
14:52represents responsibility.
14:55The question before us is not simply
14:57whether Kenya will produce oil. The
15:00question is whether Kenya will manage
15:03the proceeds wisely.
15:06Every barrel extracted should become an
15:09asset that never runs dry.
15:14At the same time, we have completed the
15:17first comprehensive national
15:19nationalwide mineral survey in our
15:22country's history.
15:24That survey has confirmed what many
15:27suspected for years
15:30that Kenya is endowed with significant
15:33deposits of strategic
17:17IC and industrial.
19:38governance, transparency and
19:39accountability
19:41at its very heart.
19:44The sovereign wealth fund
19:47will belong not to my administration
19:52but to the republic of Kenya.
19:55It will be managed according to the law,
19:59our constitution
20:01and the enduring interests of the Kenyan
20:05people. The act provides for independent
20:09professional management, strong
20:12parliamentary oversight
20:14and transparent public reporting and
20:18robust auditing.
20:21Every shilling must be accounted for.
20:23Every decision must be guided by
20:25prudence. Every investment must be
20:28measured by the legacy it leaves for
20:32future generations.
20:35Ladies and gentlemen, history seldom
20:39remembers nations for resources they
20:41possessed.
20:43It remembers them for the choices they
20:46made with those resources.
20:50The nations that achieve lasting
20:52prosperity share one defining
20:54characteristic.
20:56They think beyond the present.
20:59They plan in decades, not election
21:03cycles.
21:04They build institutions that endure
21:08across administrations
21:10and across generations.
21:14Permit me to express
21:17my appreciation
21:21that today Kenya chooses
21:28the Sorry.
21:34Sorry.
21:50Yes. Sorry. History, as I said, seldom
21:53remembers nations for resources they
21:55possessed. It remembers them for the
21:58choices they made in the use of those
22:01resources.
22:02The nations that achieve lasting
22:04prosperity share one defining
22:06characteristic.
22:08They think beyond the present. They plan
22:11in decades, not in election cycles, and
22:15they build institutions that endure
22:18beyond administrations
22:20and across generations.
22:23Permit me to express my appreciation to
22:27the National Assembly and the Senate for
22:30the diligence, patriotism and sense of
22:32national purpose with which they have
22:35passed this legislation.
22:38[applause]
22:43You have not merely passed laws.
22:45You have laid the legislative
22:47foundations of a transformation that
22:50will outlive every one of us.
22:54History will remember you not as the
22:57parliament that debated Kenya's future,
23:00but one that legislated it into being.
23:04These laws will strengthen our financial
23:07system, modernize our economy and lay
23:11foundations upon which future
23:13generations will continue to build.
23:17Today, Kenya chooses that discipline.
23:21We choose to save, to invest, to
23:24preserve, to build, and above all, we
23:28choose to honor the constitutional
23:30covenant that binds one generation to
23:34the next.
23:36The question history will ask us is not
23:40what we inherited,
23:42but what we bequitted the next
23:44generation.
23:47And I want to
23:49appreciate the leadership of the
23:51speaker,
23:54the speakers of both houses,
23:57the people of Kenya who came with ideas,
24:03the private sector players who informed
24:06the public participation
24:09and the bipartisan
24:12engagement in parliament. It went beyond
24:16sides. [applause]
24:20The entire house came together to build
24:24consensus
24:25on what we do with our present
24:29as we focus and connect it to the
24:32future.
24:34I must say
24:37I appreciate parliament's role in the
24:40last three years. The speaker said here
24:42very uh very aly what we have managed to
24:46achieve
24:48in
24:50the space
24:52around our economy and the
24:55transformation that we have undertaken
24:58from the housing fund
25:01through the social health insurance fund
25:05to the primary health fund to the
25:08emergency fund
25:10to all the other transformational
25:14legislation
25:16from governmentowned enterprises,
25:18privatization act, national
25:20infrastructure fund, now sovereign
25:23wealth fund and all the other pieces of
25:25legislation that have been undertaken by
25:27parliament.
25:30Every proposal we have taken to
25:32parliament has been subjected
25:35to the people's views in public
25:39participation
25:41to parliamentary debate
25:44and strengthened in the process.
25:48And we can proudly say today
25:52while 3 years ago we are staring at a
25:55default.
25:57While three years ago
25:59I sat in room six here with my very able
26:03team to which
26:05I am very grateful to them.
26:09And we had
26:12dollar reserves
26:14of just two and a half months
26:17of import cover about $5.7 billion.
26:22Today is sitting in our midst here our
26:26governor.
26:28Our foreign exchange reserves is going
26:31now to maybe seven months of import
26:35cover.
26:38[applause]
26:40I think just yesterday or the day before
26:44you know
26:46we are almost tripling
26:49our
26:51foreign exchange reserves in Kenya.
26:54That is extraordinary. And I want to
26:58thank these great men and women who have
27:01assisted me in putting this together
27:04with a lot of courage and with a lot of
27:07focus.
27:12numbers are beginning to show.
27:15Just yesterday or is it the day before
27:19UNAD released their report and Kenya has
27:24increased its foreign direct investment
27:28from $1.5 billion 3 years ago to $3.2
27:33billion today. [applause]
27:38and we are moving.
27:42I have asked the deputy president to
27:44chair
27:46the government committee that is going
27:48to work with private sector investors
27:52and players
27:54for what will be one of the largest
27:59investments in our country.
28:03the
28:05investment
28:07in the East African oil refinery
28:12a 2.2 trillion
28:16shilling investment in our country
28:20[applause]
28:21and we have already set a date for the
28:24groundbreaking just for your
28:25information.
28:31So
28:34we are taking steps in making sure that
28:38we take our country. When we say we are
28:40moving this country to a f first world
28:42status,
28:44we want to match
28:46our commitment with our actions.
28:51May history record that we honor the
28:54trust placed in our generation not by
28:58exhausting our nation's resources but by
29:01preserving growing and expanding them.
29:05May future generations
29:08look upon this moment
29:11and representatives of that future
29:13generation are here with us this morning
29:18and say they did not consume our
29:22inheritance.
29:23They secured it. They did not merely
29:26govern for their time. They governed for
29:30us as well.
29:33God bless you all.
29:35God bless Kenya
29:37and I wish you all the very best uh this
29:40moment asant [applause] and um to all
29:45our friends who have come here. I know
29:47there are many actors. My good friend
29:49Tades from TDP Bank here. Our good
29:53friends from IFC are here, from the
29:56World Bank here, our good friend from a
29:59TDR here. All the good people from I see
30:04the new chairman of the Nairobi stock
30:06exchange or securities exchange here,
30:09Mr. Mulwa and the formed immediate
30:11former is here and many other people who
30:15are here. I see many fund managers. I
30:18see many um pension fund people here.
30:23Many people from the banks. Uh if there
30:27was a moment we are discussing real
30:28money, this is the moment. And um we are
30:33discussing it with the right people. And
30:35I and I am very confident about the
30:38economic future of our country. I think
30:41the the the the more we pull together,
30:44the more we understand what we are
30:46doing. Listening to all the captains of
30:51our financial institutions here from the
30:53pension funds all the way to the banks,
30:56uh it gives me a lot of confidence that
30:58we are now in sync that the future of
31:02our nation is not just in the hands of
31:04government, it is in the hands of our
31:08society. that the private sector is as
31:10much part of the discussion about the
31:14governance of our country and the future
31:16of our country as it is the
31:19responsibility and business of every
31:22citizen of our republic that our
31:24children
31:26lean and ry representing them here are
31:28also part of the conversation about our
31:31country and about our future. It's a
31:33very proud moment for me as we take
31:36these uh steps, consequential historic
31:39steps of taking our country to the next
31:42level. I see people from the insurance
31:44industry and all the other players and
31:47when I listen to what they are saying
31:51deepening their financial markets. I
31:53have been to the Nairobi Securities
31:56Exchange five times.
31:58Not because I have no work to do. I have
32:01been there intentionally
32:03to give confidence that we believe in
32:06the capital markets as a source
32:10[applause]
32:12as an alternative source of capital for
32:15us to transform our country. I must
32:19commend the capital markets.
32:22They have helped us fund Talanta
32:27Railing Stadium. They are helping us
32:30fund Bombers of Kenya. the creative,
32:34you know, um, and innovative
32:39structuring of
32:41opportunities for us to be able to
32:44undertake some of our very consequential
32:47infrastructure projects
32:50from Ronimo Summit to all the other
32:53programs
32:55has been a partnership between
32:58government and the private sector. And I
33:01want to commend the private sector for
33:04stepping forward,
33:06being as courageous as us
33:10because in the past the private sector
33:12were very shy. Today we are very bold
33:15people and I want to commend you. I
33:18don't take your participation,
33:22your partnership
33:25for granted. It is making a difference
33:29in our country and this is the kind of
33:32collaboration and partnership between
33:37private sector actors,
33:39banks, pension funds, capital markets,
33:44investor investors
33:47coming together so that we can build a
33:50nation.
33:52Listen,
33:54often
33:56the public is stranded with big projects
34:01that require funding and the private
34:04sector on the other side is always
34:06stranded with a lot of money not knowing
34:10where to invest.
34:12I am happy that we are now building the
34:15ecosystem that enables
34:18private sector resources
34:21to fund public assets in a win-win
34:25outcome.
34:27That ecosystem is what is going to make
34:29a difference in our country. It is
34:32innovative.
34:33It builds on all our strengths. What the
34:38government can do best, let government
34:40do. What the private sector can do best,
34:42the private the private sector should.
34:45And that is why it was necessary for us
34:48to change the privatization act. It was
34:51also necessary for us to amend the law
34:55on uh public private part uh public
34:58private partnerships so that we can get
35:01more private sector actors into the
35:05public space.
35:07I am very happy that this morning we are
35:10here is a very proud moment for me and
35:14that we are making the right steps
35:17taking our country into the future. I
35:19want to give you my assurance
35:22that
35:24under my administration
35:26we will work with all actors. We will
35:29work together in a way that brings the
35:33whole nation uh together. I must thank
35:40the political class.
35:42I want to commend um the honorable Buru
35:46Adinga now the leader of ODM for
35:52coming together under the broad-based
35:54arrangement.
35:56Today John B is providing leadership
36:01that has never been witnessed.
36:05>> [applause]
36:05>> I can I can confirm to you
36:09John that when I write my book you will
36:11have ample space on on on what you and
36:16me have discussed and your team at the
36:19treasury of course including all the
36:22other actors that have um taken this to
36:26the future. I also must commend the
36:29leader of majority who is here
36:33and
36:35our members in parliament
36:38members of the finance committee all the
36:40members they've they've been you know I
36:43remember on
36:46I think it was Wednesday last week
36:50and I was out of the country I'd gone to
36:52attend uh the graduation of my daughter
36:56and discussions in parliament
37:00went
37:02up to midnight.
37:05Consultations outside
37:08uh the the the official
37:11space in parliament and uh I was with
37:15Lawrence there and uh he was
37:20in consultation. They were on a on a on
37:23a on a call with parliament and finally
37:28parliament came together in a very
37:31bipartisan way and said we must move the
37:34country forward.
37:36I commend them and thank you very much
37:39Kimani for your leadership, the chair of
37:43finance committee for his leadership and
37:44all the other actors. Uh I don't take it
37:47for granted because I know what it
37:49means.
37:51We have tried to do this as a country
37:53for many years.
37:55It has not happened. Not because others
37:57did not try, not because they didn't
37:59want to do it. But it it couldn't it
38:02didn't come together. We have

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