Kenya: State Should Tame Rogue Oil Dealers

It is likely that recent increases in international oil prices are steadily slowing down Kenya’s recent economic gains.

Even as the Government dilly-dallies on making policy announcements to militate against the fuel price surge, Kenyans should start to brace themselves for a general increase in prices of goods and services.
The economy will be under pressure from increased import costs of oil and related products.

This will in turn push up prices of transport, causing a spiral effect on the cost of living.

The increased demand for foreign exchange is likely to put pressure on the shilling’s strength against other major international hard currencies.

The effect of high oil prices is likely to lead to increased food prices, which have eroded purchasing power of consumers.

Central Bureau of Statistics reports indicate that overall 12-month inflation rose from 11.1 per cent in the year to June 2007 to 13.6 per cent in the year to July 2007.

AllAfrica