Fuel Shortages coming

[Georgesoros]

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Foreign currency is running low.
That will further drag down the economy.

[RV Pundit]

Nope - Ruto just signed off 4.8B dollars deal with Dubai - in gov to gov deal.

Fuel will be supplied from April 1st to Dec 31st.

Fuel shortage are cartels doing their last fight.

They want to test Ruto mettle - poor them - let them not play games

[hk]

Nope - Ruto just signed off 4.8B dollars deal with Dubai - in gov to gov deal.

Fuel will be supplied from April 1st to Dec 31st.

Fuel shortage are cartels doing their last fight.

They want to test Ruto mettle - poor them - let them not play games

Dubai will accept Ksh.? This is a fuel loan with a grace period of 6months hoping by then they'll have enough dollars to pay, if there is such agreement. Eurobonds interest rates will keep on rising as the market now knows kenya doesn't have enough forex. This is clear indicator of likely default or rolling over at very high interest rate.
Further weakening of Ksh. isnt a guarantee of increased forex inflow. Serious budget cuts needed to free up funds for imports.

[Georgesoros]

Why the dollar shortage??
Njoroge has managed it real good over the years.

[RV Pundit]

Oil companies will buy in KES and gov will pay Dubai in dollars
Of course, the idea is to kick the can in the future in the hope that US interest rate hikes will stop.
US is sucking money and causing havoc - but once they reign on their inflation - USD will flow back.
Pressure on KES will be lower.

As for budget cuts - how will that generate forex?

Gov already cut 300B - but of course this didnt show up because of 100B Uhuru had already spent outside budget and Ruto had priority project  to stimulate the economy (20B hustler fund, 15B fertilizer, 60B more to pay pending bills, 20B for CBC) - all these sum up to 200B.

Budget deficit has dropped to below 6% - and will drop further in the next budget.

Plus of coz all these depend on raising 3 trillion from taxes - I believe Mwaura is shaking KRA - and might succeed.

I think Ndii and company are on top of the game - if we had used IMF formulae - the chemotherapy would have been very bad.

For now we have to find such igneous means to borrow money - like we just borrowed from Dubai without them knowing.

Dubai will accept Ksh.? This is a fuel loan with a grace period of 6months hoping by then they'll have enough dollars to pay, if there is such agreement. Eurobonds interest rates will keep on rising as the market now knows kenya doesn't have enough forex. This is clear indicator of likely default or rolling over at very high interest rate.
Further weakening of Ksh. isnt a guarantee of increased forex inflow. Serious budget cuts needed to free up funds for imports.

[hk]

US can reduce feds rate to zero and Kenya will still have forex shortage. Cutting budget preserves forex to pay for imports and stabilize the Ksh. Instead of CBK selling $ to convert to ksh. to finance budget, those funds are used to pay for crucial imports. BTW treasury hasn't cut budget by 300b, the supplementary budget increased by 30b and only cut borrowing by 15b. 91 days Tb are now at 10% and rising. The budget deficit has reduced to about 6% due to shelving of euro bond 2022 due to high rates. 2023 budget is suppose to expand by 7% even if the economy grows by 5% that ll expand the budget deficit by about 2% to the nosebleed level of 8%.
Its not plausible to collect 1tr more in taxes without very high gdp growth of 10%. An aggressive tax regime installing even monitoring system will force companies into the grey market which further hamper collection.

[RV Pundit]

If I recall medium term plan - there is going to be less and less borrowing - in hope of more and more revenues.Taxes are not being increased - it sealing of loopholes - we should be collecting 20% of GDP easily - we know VAT has issues, custom has issues.
We also know some fatcats havent been paying taxes - 300B worth of exemptions.
So there is scope to grow revenue.

If revenues don't grow - then economy and gov will go bankrupt.

US can reduce feds rate to zero and Kenya will still have forex shortage. Cutting budget preserves forex to pay for imports and stabilize the Ksh. Instead of CBK selling $ to convert to ksh. to finance budget, those funds are used to pay for crucial imports. BTW treasury hasn't cut budget by 300b, the supplementary budget increased by 30b and only cut borrowing by 15b. 91 days Tb are now at 10% and rising. The budget deficit has reduced to about 6% due to shelving of euro bond 2022 due to high rates. 2023 budget is suppose to expand by 7% even if the economy grows by 5% that ll expand the budget deficit by about 2% to the nosebleed level of 8%.
Its not plausible to collect 1tr more in taxes without very high gdp growth of 10%. An aggressive tax regime installing even monitoring system will force companies into the grey market which further hamper collection.

[RV Pundit]

Many of the crooks were not paying taxes

Murathe, kulipa tax ni kujitegemea.

Au sio?

As you fight for Jubilee positions, or withdraw from them, lipa Tax.

Hao wengine wameanza kulipa, fuata taratibu, wacha kutumana....

— -Dennis Itumbi, CBS (@OleItumbi) March 7, 2023

?s=20

[RV Pundit]

@NTVnewsroom @citizentvkenya @inoorotv @KTNNewsKE @K24Tv @AmbokoJH @poak_kenya https://t.co/855UmtaXDa

— Martin Chomba (@ChombaMartin) March 7, 2023

?s=20

[Georgesoros]

US can reduce feds rate to zero and Kenya will still have forex shortage. Cutting budget preserves forex to pay for imports and stabilize the Ksh. Instead of CBK selling $ to convert to ksh. to finance budget, those funds are used to pay for crucial imports. BTW treasury hasn't cut budget by 300b, the supplementary budget increased by 30b and only cut borrowing by 15b. 91 days Tb are now at 10% and rising. The budget deficit has reduced to about 6% due to shelving of euro bond 2022 due to high rates. 2023 budget is suppose to expand by 7% even if the economy grows by 5% that ll expand the budget deficit by about 2% to the nosebleed level of 8%.
Its not plausible to collect 1tr more in taxes without very high gdp growth of 10%. An aggressive tax regime installing even monitoring system will force companies into the grey market which further hamper collection.

Havent we been here before. I remember back when treasury bill rates were like 15%.

[Nowayhaha]

Simple solution , do what China is doing , buy oil products from Russia and pay in Ruble .

[Georgesoros]

Simple solution , do what China is doing , buy oil products from Russia and pay in Ruble .

Sounds simple but complicated. Wont happen.
I think what is happening is Ruto et al wants to eat too, so the regular Kenyan must suffer. It could have transitioned smoothly, but they need to kick Kenyattas people out ASAP. Money talks.

[RV Pundit]

US already gave us 400M dollars food aid. Can you ask russia to match it. Let not talk about AGOA, POWER AFRICA, HIV-AIDS GLOBAL FUND and Aid worth more than a billion dollars. The Brits and EU also play around the same figures. We cant risk western allies wrath.

Your little Russian - nobody will touch - unless they have cojones like China and India.

Simple solution , do what China is doing , buy oil products from Russia and pay in Ruble .

[Nowayhaha]

You can do business with boss sides , ask Saudia Middle east countries India and Asian countries .
What is 400M Dollar . Similar amount used to keep KQ afloat each year . Wacha upuzi Pundit you have been mentally colonized , very sad for someone who says has been living in Europe. Mali and CAR have just kicked out their colonizers France and started engaging with different partners  this has made France change its policy towards former colonies .
Wake up Pundit after 2022 we are moving into a Multi Polar world . China trades with Kenya in Billions . Kenya can decide to buy processed oil from china in Yuans . Is it impossible No . It is possible it just requires a policy change . The biggest problem is however the Its our time to eat mentality . New money want to recoup and have more for the next campaigns .

US already gave us 400M dollars food aid. Can you ask russia to match it. Let not talk about AGOA, POWER AFRICA, HIV-AIDS GLOBAL FUND and Aid worth more than a billion dollars. The Brits and EU also play around the same figures. We cant risk western allies wrath.

Your little Russian - nobody will touch - unless they have cojones like China and India.

Simple solution , do what China is doing , buy oil products from Russia and pay in Ruble .

[RV Pundit]

Last year as war started - I would have advised and I did for kenya to be neutral.

Now Russia has clearly lost the battle

We should embrace the winners - Ukraine, West and Americans.

We really had no dog in the fight btw cousins - Russia has lost - too bad for them.

Pia China is now broke - not lending to Africa

So all in all - Ruto has no option except embrace West and maybe Middle East.

We need west because US and Eu control WB and IMF...and we are broke

Multipolar world has taken huge beating - because of Russia stupidity. China was playing this very well.Avoid conflict with West unless you're strong.

We are back to 1989 - the fall of USSR and end of cold war.

Now US is going to be unchallenged.

You can do business with boss sides , ask Saudia Middle east countries India and Asian countries .
What is 400M Dollar . Similar amount used to keep KQ afloat each year . Wacha upuzi Pundit you have been mentally colonized , very sad for someone who says has been living in Europe. Mali and CAR have just kicked out their colonizers France and started engaging with different partners  this has made France change its policy towards former colonies .
Wake up Pundit after 2022 we are moving into a Multi Polar world . China trades with Kenya in Billions . Kenya can decide to buy processed oil from china in Yuans . Is it impossible No . It is possible it just requires a policy change . The biggest problem is however the Its our time to eat mentality . New money want to recoup and have more for the next campaigns .

US already gave us 400M dollars food aid. Can you ask russia to match it. Let not talk about AGOA, POWER AFRICA, HIV-AIDS GLOBAL FUND and Aid worth more than a billion dollars. The Brits and EU also play around the same figures. We cant risk western allies wrath.

Your little Russian - nobody will touch - unless they have cojones like China and India.

Simple solution , do what China is doing , buy oil products from Russia and pay in Ruble .

[hk]

If I recall medium term plan - there is going to be less and less borrowing - in hope of more and more revenues.Taxes are not being increased - it sealing of loopholes - we should be collecting 20% of GDP easily - we know VAT has issues, custom has issues.
We also know some fatcats havent been paying taxes - 300B worth of exemptions.
So there is scope to grow revenue.

If revenues don't grow - then economy and gov will go bankrupt.

US can reduce feds rate to zero and Kenya will still have forex shortage. Cutting budget preserves forex to pay for imports and stabilize the Ksh. Instead of CBK selling $ to convert to ksh. to finance budget, those funds are used to pay for crucial imports. BTW treasury hasn't cut budget by 300b, the supplementary budget increased by 30b and only cut borrowing by 15b. 91 days Tb are now at 10% and rising. The budget deficit has reduced to about 6% due to shelving of euro bond 2022 due to high rates. 2023 budget is suppose to expand by 7% even if the economy grows by 5% that ll expand the budget deficit by about 2% to the nosebleed level of 8%.
Its not plausible to collect 1tr more in taxes without very high gdp growth of 10%. An aggressive tax regime installing even monitoring system will force companies into the grey market which further hamper collection.

The letter of credit being offered by banks couldn't be extended to private sector?https://www.bloomberg.com/news/articles/2023-03-07/dollar-shortage-spurs-kenya-to-seek-4-8-billion-oil-supply-cover . Basically this more like a syndicated loan payable within 6months, this only exacerbated our liable debt situation. Kenya is fast becoming a state command economy from KNTC to Kenya national oil as the sole importer of fuel.
Heavy handed tax collection leads to low compliance and expansion of informal economy. Excise duty on basic goods and services is going up. Kra has just changed duty charges on imported goods . Kenya has to get influx of forex fast and cut budget. 

[Nowayhaha]

https://www.rt.com/business/572631-russia-india-dent-dollar-dominance/

[RV Pundit]

Of course - and there in lies the brilliance - Ruto was able to borrow money in market starved off credit. Again the future is bleak but gov job is to keep pushing the can further and further hoping something will change - and global economy will boom again. Global commodities have to drop. Inflation must drop. Then we will be fine.

The letter of credit being offered by banks couldn't be extended to private sector?https://www.bloomberg.com/news/articles/2023-03-07/dollar-shortage-spurs-kenya-to-seek-4-8-billion-oil-supply-cover . Basically this more like a syndicated loan payable within 6months, this only exacerbated our liable debt situation. Kenya is fast becoming a state command economy from KNTC to Kenya national oil as the sole importer of fuel.
Heavy handed tax collection leads to low compliance and expansion of informal economy. Excise duty on basic goods and services is going up. Kra has just changed duty charges on imported goods . Kenya has to get influx of forex fast and cut budget. 

[Nowayhaha]

Where is pundit with his false narrative to avoid risking weatern allies wrath. Here Kenya doing business with Iran.


https://www.kenyans.co.ke/news/86656-kenya-export-ksh-770m-meat-iran

[sema]

Ati US rate hikes will drop? Are guys here smoking ganja? Interest going to 10% by 2025 (supply chains have broken down and they have no choice