Sharp Daily
No Result
View All Result
Thursday, July 24, 2025
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
Sharp Daily
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
No Result
View All Result
Sharp Daily
No Result
View All Result
Home News

Kenya Set to Retreat from the Fuel Import Scheme with Gulf Nations

Patricia Mutua by Patricia Mutua
August 22, 2023
in News
Reading Time: 2 mins read

Kenya is poised to withdraw from its engagement in the fuel import credit scheme negotiated with Gulf nations, a move prompted by the International Monetary Fund’s (IMF) concerns about potential currency-related costs for taxpayers. Njuguna Ndung’u, the Treasury Cabinet Secretary, has announced that the government will hand over the scheme’s management to private sector entities like oil marketing companies (OMCs), banks, and credit insurance providers.

Ndung’u clarified that the government had engaged with IMF staff to explain that the scheme, designed as a trade finance arrangement, does not pose risks to the Kenyan government. Despite this explanation, the government has decided to allow the market to function independently and shift away from its active participation in the scheme.

The fuel import credit initiative, established in collaboration with the United Arab Emirates and Saudi Arabia, aimed to reduce forex pressures by postponing the need for dollars to purchase fuel, a significant import commodity for Kenya. However, the IMF expressed concerns that the government could face budgetary implications if forex valuation losses weren’t passed on to consumers.

The IMF suggested that the private sector should bear all associated risks after the initial rollout. It highlighted that the government’s exposure could lead to budgetary calls and recommended changes in the mechanism for setting fuel prices to align with budgeted resources.

RELATEDPOSTS

Why firms are shedding jobs despite survival

June 19, 2025

Opinion: Austerity wrong medicine for Kenya’s economy.

June 16, 2025

Kenya will soon make its first payment under the scheme for the April consignment. While the government claims it is not incurring costs, it is putting safeguards in place to ensure market functionality. Despite the scheme’s operation, the Kenyan shilling remains weak against the dollar. Ndungu asserted that the arrangement has contributed to stability and predictability in the foreign exchange market, noting a shift away from using spot rates.

In response to foreign exchange risks, Kenya established an interest-bearing escrow account where proceeds from fuel sales via the scheme are deposited. Ndung’u further expressed willingness to work with the IMF to ensure the market’s smooth operation while maintaining a sense of stability in the foreign exchange market.

Previous Post

Ill-Famed Kenyan ‘Businesswoman’ Arrested over Suspicion of Drug Trafficking

Next Post

Kenyan Startups to Benefit from AI Training by Google

Patricia Mutua

Patricia Mutua

Related Posts

commercial illustrator
News

Why Kenyan private equity firms should consider continuation funds as an exit strategy

July 23, 2025
Business

Del Monte foods files for bankruptcy in USA

July 3, 2025
News

Private vs Public Pension Funds in Kenya

June 30, 2025
Investments

Investor shift to long term bonds drives oversubscription in CBK’s reopened auction

June 19, 2025
News

The real price of Israel – Iran Conflict for Kenya.

June 19, 2025
Economy

Resilient but strained: Kenyan firms speak out in May 2025 CEO survey.

June 19, 2025

LATEST STORIES

Why young professionals should care about pensions

July 23, 2025

How Kenya can reinforce fiscal rules to prevent recurrent budget overruns

July 23, 2025
commercial illustrator

Why Kenyan private equity firms should consider continuation funds as an exit strategy

July 23, 2025

Transferring Your Retirement Benefits Between Pension Schemes in Kenya

July 23, 2025

Invest in stability: introducing the Cytonn USD money market fund

July 18, 2025

The Importance of Asset Diversification on Kenyan Pension Funds

July 18, 2025

Park your money where it grows: Why more Kenyans are turning to Cytonn Money Market Fund

July 16, 2025

Strategies to boost alcohol and tobacco tax revenues

July 16, 2025
  • About Us
  • Meet The Team
  • Careers
  • Privacy Policy
  • Terms and Conditions
Email us: editor@thesharpdaily.com

Sharp Daily © 2024

No Result
View All Result
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team

Sharp Daily © 2024