Tuesday, December 27, 2022 – Kenyans are set to pay dearly to keep their machines running and to afford basic commodities thanks to President William Ruto’s not well thought out decision to withdraw fuel subsidies which had been introduced by former President Uhuru Kenyatta to cushion members of the public.
This is after it emerged that fuel prices are bound to increase starting in January 2023 when Energy and Petroleum Regulatory Authority (EPRA) announces a new price review.
According to the budget outlook paper, the fuel subsidy will be withdrawn on December 31, marking the end of the programme introduced by Uhuru.
However, Ruto’s administration will retain the subsidy programme for some agricultural products.
“The government will eliminate the remaining unsustainable and consumption-driven fuel subsidy by the end of December 2022, but will continue to offer support to agricultural production through the fertilizer subsidy programme,” the outlook paper read in part.
Defending the decision to withdraw fuel subsidy, the National Treasury indicated the move aimed to sustain the country’s economy.
“Medium Term Budget framework builds up on the government’s efforts to stimulate and sustain economic activity, mitigate the adverse impact of the pandemic on the economy and re-position the economy on a sustainable and inclusive growth trajectory,” the paper added.
According to the budget projection for 2023, the increases in fuel prices will also have ripple effects on the country’s inflation rate.
“Inflation is expected to remain elevated in the near term, due in part to the scaling down of the government price support measures, resulting in increases in fuel and electricity prices,” it added.
A litre of petrol in Nairobi currently retails at Ksh177.30, diesel at Ksh162.00 and kerosene at Ksh145.94, according to the price review announced by EPRA on December 14 and set to run till January 14.
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