DP Rigathi Gachagua now claims Israel, Palestine war will exacerbate the fuel price situation in the country.
The Deputy President made the claim while speaking to a caucus of professionals and politicians from the Mt. Kenya region on Saturday at the Nyeri Golf Club, defended the government, saying the circumstances affecting fuel costs are ‘beyond our control.’
“Another crisis is manifesting around the Palestine and Israel, and that is not healthy for fuel,” Gachagua said.
“Many people have accused the government of escalating the cost of fuel. No responsible government can do that.”
Gachagua’s claim comes just a week after the Energy and Petroleum Regulatory Authority (Epra) increased fuel prices by Ksh5.72 per litre, diesel prices by Ksh4.48 and kerosene prices by Ksh2.45.
He said Kenya’s prices, which hit a record high of Ksh. 217 per litre in Nairobi a week ago, were similar to the country’s neighbors in the East Africa Community Bloc.
“And again if you check, the price of fuel here per liter is similar to the price per litre in Tanzania, Uganda, Burundi, Rwanda…and is the same everywhere,” he added.
In addition, Gachagua ruled out the possibility of the government reinstating a subsidy to stabilize the retail fuel prices.
He claims that if a subsidy were reinstated, the government would be compelled to raise taxes even more to pay for it.
“If we subsidize fuel today, we’ll have to collect that money from somewhere and we will have to add more taxes..so we are saying we cannot subsidize fuel because that money will have to come from somebody, and that money would have to come from the taxpayer,” he said.
“So the situation is global.”
The Deputy President also attributed Kenya’s current financial predicament to a USD 2 billion Eurobond loan that she claimed was “not properly thought out,” noting that the loan’s interest rate of 16 to 17 percent is nearly unpayable.
He said that although Kenya collects some Ksh. 2.2 trillion in revenue, the entire sum is wiped out by the loan repayment as well salaries payments.
“Paying the public debt and paying salaries wipes out Kenya’s Ksh.2.2 trillion revenue collection,” he added.
“We are left without any money for development,’