Importation Cost Of Commodities Rises To Triple
In a statement to the media on Tuesday, June 22, NCBA Managing Director John Gachora highlighted that the rising cost of transportation, which was a result of rising fuel prices, had increased pressure on the local dollar reserves.
Lydia Kadima 
"To get containers from China to Kenya or from Turkey to Kenya, prices have tripled or even more. In some cases, they have gone up four or five times.”
"It means that if you are buying the same bag of cement today where you needed to buy it for 10 dollars, you are going to need 20 dollars for the same bag of cement," he stated.
Gachora added that the dollar shortage was brought on by rising business demand rather than a lack of money in the local reserves.
He argued that certain businesses had filed a false demand after demanding money in the same amount from various banks.
"Because of people thinking there are not enough dollars, what we see is traders will go to five or six banks asking for the same thousands of dollars.
"Let's say you want USD 100,000, you go ask one bank for it and then the second and third. By the time you go to five banks, the market thinks you want USD500,000 when you only need USD100,000," he explained.
Recently, a number of businesses including Pwani Oil reported that they were reducing their production after having trouble getting dollars to buy raw materials.
Dr Patrick Njoroge, Governor of the Central Bank of Kenya (CBK) responded to Pwani Oil’s temporary closure by saying the has sufficient supply dollars.
Njoroge said that the nation distributes USD2 billion per month, which should be sufficient to meet the needs of the manufacturing sector.
He claimed that businesses that were considering stopping operations should have easy access to money because their needs are much lower than the monthly dividend.
