Parliament was gripped by national security worries on Tuesday as the government sought to explain why it intends to cut its stake in Safaricom PLC, with critics warning that the move could weaken State influence over one of Kenya’s most critical digital assets.
Appearing before MPs, National Treasury Cabinet Secretary John Mbadi said the plan to sell up to 15 per cent of the government’s holding poses no threat to national security. He argued that Safaricom’s importance to Kenya’s communications, financial systems and data networks is safeguarded by regulation and law rather than by how many shares the State owns.
Mbadi told the committee that the proposal is part of a wider effort by Parliament to find ways of unlocking value from public assets without compromising sovereignty, security or oversight in key sectors of the economy.
Safaricom’s listing on the Nairobi Securities Exchange in 2008, he noted, was designed to broaden ownership while keeping the firm firmly anchored in Kenya’s legal and regulatory framework. Even as the shareholder base expanded, the State maintained its grip through regulators and legislation governing telecoms, data protection and financial services.
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He also pointed to Safaricom’s expansion into Ethiopia, saying the new business is still making losses and continues to require shareholder funding. That, however, is a commercial burden, not a security risk.
Concerns about foreign ownership, Mbadi added, should not be confused with national security. He said the technical and managerial input from Vodacom, part of the UK-based Vodafone group, has helped drive Safaricom’s success without eroding State authority.
He reminded MPs that even when the government owned around 35 per cent of the company, it did not run Safaricom through boardroom influence. Decisions affecting public interest, such as the reduction of mobile money charges during Covid-19, were made by regulators like the Central Bank, not by the Treasury as a shareholder.
Safaricom, Mbadi stressed, remains a Kenyan company, managed locally and tightly supervised by bodies including the Communications Authority, the Central Bank, the Data Protection Commissioner, the Competition Authority and national security agencies. That is where real control lies.
In his view, if Kenya’s security is not compromised at Airtel, where the State owns nothing, then trimming Safaricom’s stake by 15 per cent hardly amounts to a national threat.
