- Government seeking ways to settle about $328 million payment
- President Ruto scrapped fuel subsidies after taking office
According to Bloomberg article published on May 16, 2023, Kenya plans to raise money through a bond sale to pay what it owes oil marketing companies in subsidy arrears, according to people with knowledge of the matter.
The East African nation’s government owes oil marketers about 45 billion shillings ($328 million) that stretch back over a year under a subsidy program. The suppliers sold petroleum products below the market price to cushion consumers against inflation under condition that the state would compensate them.
Fuel retailers, the National Treasury and Energy Ministry are working on details of the plan, according to the people who requested not to be identified because they aren’t authorized to discuss the matter publicly. Nothing is final yet and the proposal may be amended, they said.
Treasury Principal Secretary Chris Kiptoo and his counterpart at the Energy Ministry, Mohamed Liban, didn’t respond to separate requests for comment on Tuesday.
President William Ruto, who came into office in September, scrapped the subsidies to focus on production inputs such as fertilizer instead of energy and food consumption. His administration is seeking ways to clear the arrears without significantly impacting the budget.
