Gov’t Warns of Price Hikes As 600 Ships Stuck At Sea Over Middle East War
Prices of manufactured goods in Kenya could soon increase exponentially.
This comes as the manufacturing industry faces disruptions following global turbulence in maritime transport, leaving over 600 vessels bound for Kenya stranded at sea.
Trade and Investments Cabinet Secretary Lee Kinyanjui said the situation could lead to delays in the delivery of raw materials and the export of finished products.
Kinyanjui was speaking during the launch of the regulatory audit report for the manufacturing sector on Tuesday, March 10.
According to the CS, the situation could also lead to higher insurance costs, thereby raising the overall cost of doing business in the country.
According to experts, this is likely to be transferred to consumers, meaning Kenyans could dig deeper into their pockets if the delays persist.
He warned that disruptions to maritime logistics could affect the availability of key raw materials used by manufacturers and delay the movement of Kenyan goods to international markets.
“In the maritime space, over 600 vessels are stranded on the high seas, which may affect raw materials coming in and goods going out, with insurance costs also going up,” Kinyanjui stated.
The CS, however, noted that the government is closely monitoring the developments and will convene a meeting with relevant ministries to assess Kenya’s preparedness and identify mitigation measures to protect the manufacturing industry.
“Sustainability of our industry in view of global turbulence is critical,” he added.
“This week, we will hold a meeting with relevant ministries to assess our preparedness and mitigation measures to ensure our growth is sustainable.”
He assured stakeholders that the government would explore alternative measures to cushion the sector from the impact of the global shipping challenges.
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“While the situation is not of our making, we will seek ways and alternatives to reduce the impact on the manufacturing sector,” the CS said.
Kinyanjui also cautioned that Kenya’s heavy reliance on imported fuel could expose the economy to external shocks and called for increased investment in green energy as a long-term solution.
The development comes amid a crisis in the Middle East following Israel’s and the U.S.’s war with Iran that has disrupted ship movements, especially in the sea close to Iran.
Following the disruptions, Energy and Petroleum CS Opiyo Wandayi also called for an emergency meeting with oil marketers, hours after meeting with companies supplying oil to the country.
Gov’t Warns of Price Hikes As 600 Ships Stuck At Sea Over Middle East War
