The Central Bank of Kenya (CBK) reacted to DP Gachagua’s claims that Kenya lacks enough foreign exchange reserves to import oil.
However, in a quick rejoinder, CBK dissociated themselves from the DP’s claims, noting that they do not supply requisite foreign exchange and that all foreign exchange for private transactions is obtained from commercial banks.
“CBK does not supply foreign exchange for transactions other than for the National Government (i.e., government’s own imports or debt service payments) or CBK’s operations. Oil importers, therefore, obtain their requisite foreign exchange from the commercial banks and not CBK,” a statement by CBK reads.
Moreover, while speaking during an interview on Sunday evening, Gachagua stated that the country’s financial state is dire that there were no reserves to purchase oil from other nations.
“Tumekosa maneno ya Foreign Exchange hata jana pale katika benki kuu hakukuwa na zile pesa za kigeni za kutosha kuagiza mafuta kutoka nchi za nje (We have lacked foreign exchange, even yesterday there was no enough forex at Central Bank to buy oil from foreign countries),” Gachagua said.
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Furthermore, CBK noted that their foreign exchange cover remains adequate and that they will continue to cushion foreign exchange markets in the occurrence of shocks.
“The Central Bank of Kenya Act (Section 26) requires that CBK “at all times use its best endeavors to maintain a reserve of external assets at an aggregate amount of not less than the value of four months’ imports as recorded and averaged for the last three preceding years.” This stood at 4.64 months of imports as of September 26, 2022,” read part of the statement.
In addition, CBK stated that their foreign exchange reserves continue to offer adequate cover and a buffer against shocks in the foreign exchange market.
