21 April 2011

Kenya: Kibaki Pledges Action On Food Prices

Photo: Nation
President Mwai Kibaki waves to supporters.

Nairobi — The Government will take measures to ensure inflation is under control and that food stocks are released to ensure that prices remain in the reach of all Kenyans.

This was President Kibaki's pledge in his Easter message to Kenyans Thursday. The head of State said his government would ensure that food is made available to the most vulnerable in the society.

"This year we are celebrating Easter at a time when we are facing various challenges relating to our livelihoods. Some of these challenges are the result of developments in other parts of the world and the vagaries of weather," said the President.

"As we grapple with these challenges as a Government, I urge all Kenyans to embrace the true Christian spirit of assisting the less fortunate members of our society," he added in a statement to newsrooms.

At the same time, the government has blamed the rising cost of fuel on the growing unrest in the Arab World and the poor performance of the Kenya shilling against the US dollar.

In an advertisement, Energy Permanent Secretary Patrick Nyoike attributed the crisis to the global demand which has exceeded supply over the past two years.

But the Consumers Federation of Kenya, which led public protests on the matter this week, accused the PS of running away from local factors that inflate prices.

Cofek secretary general Stephen Mutoro said the factors include corruption, gross inefficiency in the sector and a compromised and weak regulator. Price controls introduced by the government, he added, had failed and alternative means to regulate prices should be explored.

But Mr Nyoike defended the price controls saying pump prices could have been much higher today had it not acted.

"When an extrapolation formula is applied to compare the current pump prices with the July 2008 pump prices, it can be deduced that the oil marketers, without price control, could have posted product prices of around Sh121.91 for super, Sh116.34 for diesel and Sh96.19 for kerosene," he said.

The price controls were introduced on December 15, last year.

In the meantime, the Kenya Pipeline Company is installing a new line from Nairobi to Eldoret which will increase its capacity to pump fuel from 200,000 litres per hour to 600,000 liters per hour. The company is also installing new pumps between Mombasa and Nairobi to achieve the maximum pumping capacity of 830,000 litres per hour by November, the PS said.

Nairobi Metropolitan Development minister Njeru Githae urged politicians to stop politicising the matter and instead look for a solution.

And the chairman of Centre for Multiparty Democracy Prof Larry Gumbe, urged the Government to rein in the escalating prices of essential food commodities and fuel.

Prof Gumbe accused the Government of taking a casual approach towards resolving the issue.

The Kenya National Chamber of Commerce and Industry (KNCCI) accused the government of entrusting the work of regulating fuel prices to "a protected government cartel".

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