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HomeBusinessGovernment exudes confidence of shilling gaining strength against the dollar

Government exudes confidence of shilling gaining strength against the dollar

By Yvonne Chebeni

Deputy President Rigathi Gachagua has said that the Kenyan shilling is set to strengthen over the few months after the government started paying for fuel in local currency.

Gachagua  together with the Energy Cabinet Secretary Davis Chirchir received  the first consignment of oil valued at Sh20 billion from the United Arab Emirates (UAE) landed in the country at the port of Mombasa, Kipevu oil Terminal.

Chirchir said the pressure on the Kenyan shilling was already being eased as he hopes dollars will help in other sectors.

“We hope the dollars will be performing to other sectors of the economy. The government has been spending $500 million (Sh 67.2 billion) monthly to import fuel,” Chirchir stated

Gachagua tweeted that “the deal will relieve the pressure on the country’s dollar reserves since fuel was imported on credit and will be paid in shillings.

“Our quest to stabilise our economy got a major boost today as we received over 160, 000 metric tonnes of fuel under the government-government agreement at the port of Mombasa,” read the tweet

While addressing the press, Gachagua listed three oil companies were nominated to import fuel into the country on behalf of other marketers which had earlier on accused the government of excluding them from bidding under the open tender system.

These includes: Abu Dhabi National Oil Corporation (ADNOC), Saudi Aramco and Emirates National Oil Company (ENOC).

Saudi Aramco which will supply two diesel cargo consignments monthly while the Abu Dhabi National Oil Company will supply three cargo consignments of super petrol monthly.

He also stated that the memorandum entered with prospective governments will be for the supply of petroleum products on an extended credit period of 180 days.

Under the six-month agreement, three companies in the Middle East will export petroleum products to Kenya. These are Abu Dhabi National Oil Corporation (ADNOC), Saudi Aramco and Emirates National Oil Company (ENOC).

President William Ruto on Tuesday during the release of the performance contracting report for the 2021/2022 financial year at the Kenyatta International Convention Centre (KICC) steted that there would be increase in the value of shillings estimating that a dollar will be exchanged with 115 or 120 Kenyan Shilling.

“My economic adviser David Ndii, Mohammed Hassan, Davis Chirchir and the (EPRA) Daniel Kiptoo have done something phenomenal. They have managed to put together a programme that has taken us away from looking for 500 million dollars every month to buy fuel,” he stated





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