All you need to know about Sovereign Wealth Fund Bill signed into law by Ruto
By Mabonga Makhanu, July 8, 2026President William Ruto on Wednesday, July 8, 2026, signed the Sovereign Wealth Fund Bill into law during a ceremony at State House attended by senior government officials from various ministries, Members of Parliament and schoolchildren, whose presence symbolised the law’s commitment to safeguarding wealth for future generations.
The Bill, which was introduced in the National Assembly by the majority leader, Kimani Ichungwa, underwent the first reading before being subjected to public participation and scrutiny by the Departmental Committee on Finance and National Planning, chaired by the Molo MP, Kuria Kimani.
The new law establishes a legal and institutional framework for the creation and management of Kenya’s Sovereign Wealth Fund. It provides for a professionally managed fund that will preserve and invest national wealth for the benefit of both current and future generations.
‘4. (1) There is hereby established a fund to be known as the Sovereign Wealth Fund. (2) The Fund shall be managed and invested for the benefit of current and future generations of the citizens of Kenya’ The SWF law reads
Three Key components of the Fund
The Sovereign Wealth Fund is divided into three main components:
1. Stabilisation Fund
This fund is designed to cushion the country against economic shocks arising from global and domestic crises, including pandemics, natural disasters, commodity price fluctuations, financial crises and geopolitical conflicts. It will provide the government with financial resources during periods of economic instability.
2. Strategic Infrastructure Investment Fund
This component will finance major national development projects by partnering with the private sector. The goal is to mobilise long-term capital for strategic infrastructure such as roads, railways, energy, water projects and other investments that stimulate economic growth.
3. Future Generations Fund
The Future Generations Fund is the most protected component of the Sovereign Wealth Fund. Under the law, at least 30 per cent of all resources allocated to the Sovereign Wealth Fund must be deposited into this account.
The law strictly prohibits borrowing against the fund or using it as collateral. It also limits investments in high-risk financial products to ensure the money is preserved for future generations of Kenyans.
How the Fund will be managed
The law establishes a board responsible for overseeing the management of the Sovereign Wealth Fund.
The board will comprise:
A chairperson appointed by the president.
The Cabinet Secretary for the National Treasury.
The Cabinet Secretary responsible for mining.
The Cabinet Secretary responsible for petroleum.
Four competitively recruited professionals were selected based on their expertise in finance, investment and related fields.
The board will appoint professional investment managers to oversee the fund and ensure all investments comply with the law.
Investment safeguards
To protect public resources, the Act bars investments in highly speculative assets such as certain private equity ventures, speculative derivatives and other high-risk financial instruments.
Instead, the fund will invest in safer, long-term assets aimed at preserving and growing national wealth while minimising financial risk.
Governance and accountability
The Sovereign Wealth Fund will operate under the Public Finance Management Act and other relevant laws governing public finances. The Act also includes detailed schedules outlining how investments will be made, how withdrawals can be authorised, the governance structure of the board and the reporting requirements to ensure transparency and accountability.
The Public Finance Management Act shall apply to the administration and management of the Fund.
‘Any withdrawal from the Stabilisation Component and Strategic Infrastructure Investment Component shall be made in accordance with the fiscal responsibility principles prescribed in section 15(2) of the Public Finance Management Act and the procedures prescribed in this Act. (1) For section 24(5) of the Public Finance Management Act, the Chief Executive Officer shall be the administrator of the Fund. (2) The administrator shall— (a) prepare quarterly financial statements in respect of the Fund in accordance with the Public Finance Management Act; and’ The law reads
The government says the establishment of the Sovereign Wealth Fund is intended to help Kenya build long-term financial resilience, support strategic development projects and preserve part of the country’s wealth for generations yet to come.