President Ruto Signs Sovereign Wealth Fund Law. Will Kenya Succeed Where Many Resource-Rich Nations Have Struggled?

President William Ruto has signed the Sovereign Wealth Fund Bill, 2026 into law, creating a legal framework for Kenya to save part of its natural resource revenues, finance strategic infrastructure and cushion the economy from future shocks.

The new law establishes three components of the Fund: the Stabilisation Component, the Strategic Infrastructure Investment Component and the Future Generations Component(Urithi). Under the law, 30% of total mineral and petroleum revenues will be allocated to the Future Generations Component(Urithi), which is meant to preserve wealth for Kenyans who will come after the current generation.

Ruto said the law marks a shift in how Kenya manages national wealth, especially as the country moves to exploit more mineral and petroleum resources. “Natural resources are finite, and once they are exhausted, they are gone forever,” he said. “That is why we do not want one generation to benefit at the expense of those who come after.”

The Stabilisation Component will provide the government with a financial buffer during extraordinary shocks that may affect macroeconomic stability, including pandemics, global energy disruptions or geopolitical conflicts. The Strategic Infrastructure Investment Component will support priority projects aligned with Kenya’s development plans, while also helping attract private sector financing into infrastructure.

Treasury Cabinet Secretary John Mbadi said the Fund reflects a deliberate choice to balance current development needs with the interests of future generations. He dismissed calls to wait until Kenya has a budget surplus, saying the country must start building the Fund early.

The law also introduces safeguards on how the money will be managed. Withdrawals will require approval in line with the Constitution, the Public Finance Management Act will apply to the Fund, and annual financial statements will be submitted for audit. The Fund’s board will also be required to prepare annual reports for publication and submission to the National Assembly.

The idea is ambitious, but its success will depend less on the law itself and more on discipline. If the Fund is protected from political pressure, audited properly and used only for its intended purpose, it could help Kenya turn finite natural resources into long term national wealth. If not, it risks becoming another public finance promise weakened by poor execution.