CBK dismisses DP Gachagua's claims that Kenya lacks foreign exchange reserves

Albanus Kiswili for Tv47 Digital October 03, 2022, 09:07 AM

Rigathi Gachagua and CBK governor — (PICTURED) Deputy President Rigathi Gachagua (right) and CBK governor Patrick Njoroge (left). PHOTO/FILE

In Summary

CBK dismisses DP Gachagua's claims of foreign exchange
CBK says Kenya has enough foreign currency to run for the next four months

The Central Bank of Kenya (CBK) has dismissed claims by Deputy President Rigathi Gachagua that the country does not have enough foreign exchange reserves to import oil.

In a statement issued on early Monday, October 3 morning, CBK said that it does not supply foreign exchange for transactions other than for the National Government or CBK operations.

"First, following the complete liberalization of the foreign exchange market in the 1990s, all foreign exchange for private transactions is obtained from commercial banks.

"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 operations,” CBK said.

DP Gachagu's allegations

Speaking during an interview with Citizen TV on Sunday, October 2 evening, Gachagua claimed that the country does not have enough foreign exchange cover 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 insufficient foreign exchange and the Central Bank does not have enough foreign currency for importing fuel),” Gachagua had said.

However, in its statement, CBK has said that it has enough currency to run for up to four months as required by law.

"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," CBK added.

The bank further said that its usable foreign exchange reserves stood at $7.4 billion (KSh894 billion) as of September 29, 2022.