Kenyan Central Bank Rejects Deputy President Rigathi Gachagua’s Claims Country Lacks Forex to Import Oil – The Kenyan central bank has responded to remarks made by Kenya’s vice president, Rigathi Gachagua, in which he claimed that the East African nation lacked foreign exchange reserves to import fuel. The bank stated in a statement that it “does not supply foreign exchange for transactions other than for the national government.”
According to the bank, all foreign exchange utilized for private transactions and oil imports comes from commercial banks. Since the total liberalization of the foreign exchange market in the 1990s, this has been the case, according to the bank’s statement.
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In addition, the Central Bank of Kenya (CBK) argued that it is required to abide by the country’s central bank act. The law, known as the Central Bank of Kenya Act (26), specifies: “The CBK at all times use its best endeavours to maintain a reserve of external assets at an aggregate amount of no less than the value of four months’ imports as recorded and averaged for the last three preceding years.”
According to the CBK, Kenya’s import cover as of September 26, 2022 was 4.64 months. The release also indicated that the CBK had $7.42 billion in usable foreign exchange reserves as of September 29, 2022. Gachagua, who was recently inaugurated as Kenya’s vice president, recently told Citizen Digital that Kenya’s economic prospects are dim.
According to him, the grave circumstances compelled the new government to eliminate the fuel subsidy. Gachagua noted that the government of President William Ruto will prioritize increasing food production. However, in its statement that dismisses Gachagua’s claims, the CBK insisted that it will “continue to provide adequate cover and a buffer against shocks in the foreign exchange market.”
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