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{
    "id": 1254146,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1254146/?format=api",
    "text_counter": 97,
    "type": "speech",
    "speaker_name": "Prof. Njuguna Ndung’u",
    "speaker_title": "The Cabinet Secretary, National Treasury and Economic Planning",
    "speaker": null,
    "content": "2023 that allows for importation of petroleum products by the private sector through the current Open Tender System (OTS). To date, the monthly importation of petroleum products is approximately 740,000 metric tonnes of which 60 per cent is consumed in the domestic market while 40 per cent is for transit market in the region. This product is currently paid for using the United States (US) dollar, which puts a strain on foreign exchange availability and pressure on nominal exchange rate and ensuing exchange rate volatility in the market on a monthly basis. Hon. Speaker, to contain the pressure of the US dollar availability in the market as well as the exchange rate volatility on a monthly basis, the Government entered into a memorandum of understanding with governments of oil producing countries under which framework agreements have been signed with petroleum exporting companies for the supply of petroleum products on extended credit period of 180 days. The objective of this arrangement is: first, to ease the monthly demand for US dollars in the foreign exchange market that is driven by petroleum imports by extending time required to source for US dollars from the current five days to one hundred and eighty days. Second, to allow space to activate the interbank foreign exchange market thus stemming currency speculation. It was necessary to enter into this programme. Third, we intended to reduce the cost of petroleum products by leveraging on economies of scale that arise from having longer supply contracts of up to 270 days with potential suppliers. Fourth, we wanted to make sure that we avert supply disruption by safeguarding long-term supply contracts for petroleum products. Finally, to allow us, in future, to restructure the fuel pricing mechanism that will be dependent on market conditions. Currently, the fuel pricing mechanism coordinates expectations of price revisions on the 15th of every month, a situation that does not reflect appropriate market conduct as well as encourage diverse market development paths in this sub- sector. I now turn to climate change mitigation and adaptation. Climate change has become a pressing issue globally. Like other economies, the Kenyan economy is vulnerable to its ravaging impacts. Indeed, we have just come out of the worst drought in 40 years which has claimed lives of people and livestock, while at the same time threatened livelihood of millions of Kenyans. Given our vulnerability to climate change, it is imperative that we build a more climate resilient economy. For this reason, the Government has stepped up climate adaptation and mitigation efforts including green energy, smart agriculture, decarbonized manufacturing, e- mobility and green building, all aimed at the attainment of zero carbon by 2050. The Government has committed to secure our future and to achieve a cleaner and safer environment for all Kenyans by reducing greenhouse gas emissions, halting and reversing deforestation, biodiversity loss and land degradation. In this regard, issues of climate change mitigation and adaptation have been mainstreamed in all Government programmes and across all levels of Government. As part of drought mitigation measures and the climate adaptation programme, the Government is implementing a national tree planting campaign which is championed by His Excellency the President and seeks to enhance our national tree cover from 12 per cent to 30 per cent by 2032."
}