KENYAN INVESTMENT COMMITTEE HALTS SALE OF STATE REINSURER

Kenya’s parliamentary investment committee has decided to block the sale of state-owned reinsurer Kenya Re to Zimbabwe Re, following a four-hour meeting with finance ministry officials. Committee chairman Wafula Wamunyinyi said that the decision to suspend the planned sale reflected a committee consensus that the “reasons given by the government [for the sale were] not convincing enough”. The move follows a separate intervention two weeks ago by Kenyan parliamentary member Anyang’ Nyong’o, who said at the time that he had instructed lawyers to prepare to request an injunction against the sale to stop the government selling “a valuable asset” for well below its true market worth. Professor Nyong’o also claimed that the government would use the funds raised by the sale to bankroll its re-election campaign, arguing that the reinsurer was in fact worth KS7.5bn, rather than the KS800m the state is reported to be seeking from a sale. The Kenyan government recently confirmed that it was keen to press ahead with its sale of the reinsurer, having received three formal bids for the company arising from the privatisation process it began last October. Kenya Re was originally formed in 1970 to stop the outflow of reinsurance premiums from the country. It lost its right to compulsory cessions from local insurers in 2000 and now provides fire, accident, motor, marine, aviation and life reinsurance across the region covered by the Common Market for Eastern and Southern Africa.