Easter, Ramadhan dulled by rising fuel, food prices

Monday April 18 2022
Motorists queue for fuel.

Chaos as motorists queue for fuel in Nairobi on April 13, 2022 as Kenya grapples with shortage of the commodity. PHOTO | FRANCIS NDERITU | NMG


The past two weeks have been difficult for Kenyans, especially motorists who have had to queue for long hours on roads adjacent to the few petrol stations that had fuel, as the country faced an unprecedented nationwide shortage.

On Thursday, the acting Cabinet Secretary for Petroleum and Mining, Monica Juma, called out oil marketing companies accused of hoarding to account, and assured citizens of an end to the crisis.

At the onset of the crisis on April 1, oil marketers said they were protesting delayed remittance of subsidy dues by the government, an issue which the ministry says has since been resolved.

At a press briefing on Thursday, Ms Juma said the continued fuel shortage was induced by oil marketers hoarding supplies ahead of the monthly price review by the Energy and Petroleum Regulatory Authority (Epra) on April 14, in anticipation of higher prices.

The price review increased petrol and diesel prices by Ksh9.9 ($0.086) to Ksh144.62 ($1.25) and Ksh125.5 ($1.09) per litre respectively. Epra said the increase was necessitated by rising crude prices — which shot up by 14.46 percent to $85.11 per barrel in a month — and a depreciating currency, which fell 0.71 percent to Ksh114 to the dollar in the same period.



The price increase came just a day after UN Secretary-General Antonio Guterres launched a report on the assessment of the impact of the Russian invasion of Ukraine on developing countries. He said that rising oil and commodity prices are inevitable in countries that already have a huge debt burden.

With the rising cost of living, Easter festivities will be muted will this year, as more than three million people are facing hunger. In addition, a demanding new school year starts on April 25, with the cost of learning materials going up and administrators expected to raise fees.

Ugandans will not have it any easier after the state ruled out any form of subsidies to cushion them from the rising fuel and commodity prices.

According to Ramathan Ggoobi, secretary in Uganda’s Finance ministry, issuance of subsidies “is bad economics and could get us into more trouble because it takes money to the wrong people”.

As citizens and parliamentarians continue to ask the government to curb the skyrocketing prices in Uganda, the only help in sight is a planned expansion of the production of crude palm oil in Buvuma, Kalangala, Bundibugyo, greater Masaka and other areas.

Minister of State for Trade Harriet Ntabazi said this will help bring down the prices of commodities that require crude palm oil as inputs, including laundry soap, cooking oil and sugar.

“We are confident that we will have the right prescription to immediately stem the situation,” Ms Ntabazi said. “Even those whose prices have started to rise, we will drive them down.”

Mr Ggoobi said no taxes will be introduced in the next financial year, and existing ones are undergoing reforms to cushion consumers from the rising commodity prices.

In Tanzania, consumers continue to grapple with high prices, although the inflation rate dropped by 0.1 percent in March, to 3.6 percent.

Joseph Mwamunyange, a Dar es Salaam resident, said: “The reality on the ground is scary. We have always treated Easter as one of those holidays when we congregate with other family members. But this time, things aren't looking up,” he said.

The latest data from the National Bureau of Statistics shows that although prices slowed for some non-food items like insurance and financial services, transport clothing and food costs rose by 6.5 percent in March.

Wheat flour went up 2.2 percent, rice 2.9 percent, maize flour 1.6 percent, fresh fish 3.6 percent and cooking oil 1.9 percent.

Fuels, including charcoal, firewood, diesel and petrol, also increased in price by 5.7 percent, 3.5 percent, 2.9 percent, and 2.7 percent respectively.

Little excitement

Many Tanzanians have shown little excitement for the Easter holiday, and Idd ul Fitr for the Muslims in early May.

“The increase means adjustments will have to be made in order to minimise their effects on how we celebrate Easter,” Mr Mwamunyange said.

A new UN report has made recommendations to the World Bank, the International Monetary Fund and governments across the globe to help cushion developing countries from inflationary pressures.

The suggested interventions include relief for debt-stressed states, reallocation of Special Drawing Rights to African countries that need them the most, and increased funding and aid to drought affected areas and for mitigation of climate change effects.