By Judith Gicobi
The Central Bank of Kenya (CBK) has responded to the closure of Pwani Oil, a cooking oil company, due to a dollar shortage in Kenyan reserves.
On Tuesday, June 7, Central Bank Governor Patrick Njoroge told the press that the country’s reserve of dollars is sufficient.
The banker went on to say that the country allocates USD2 billion per month, which should be enough to fulfill the manufacturing sector’s needs.
Addressing businesses that were considering shutting down, Njoroge claimed that they should be able to get dollars without difficulty because their demands are significantly less than the monthly dollar allocation.
“The market covers a lot. The market generates and distributes something like USD2 billion every month.”
“If you have a sector that is importing USD90 million or USD100 million, I think that is nowhere near the USD2 billion that we are putting out there and they should understand that they are small in that sense and sort of go to the market in that sense,” explained Njoroge.
His statement came only a day after Pwani Oil, based in Kilifi County, declared that it was temporarily suspending their operations.
Due to the dollar scarcity, Kapa Oil, a prominent participant in the cooking oil and detergents industries, is also running below capacity. Rina cooking oil and Toss detergents are two of the company’s most well-known products.