KAM has warned that rising fuel prices, collapsed government talks with matatu operators, and ongoing transport disruptions are threatening the economy, supply chains, and worker productivity.

📻 Breaking It Down

NAIROBI, Kenya, May 19 — The Kenya Association of Manufacturers (KAM) has warned that surging fuel prices and ongoing public transport disruptions are threatening industrial productivity and pushing the economy toward deeper instability.

The warning came as a nationwide matatu strike entered its second day following the collapse of high-stakes talks between the government and public transport operators over rising diesel prices.

In a statement issued on Monday, KAM said the sharp increase in fuel prices announced by the Energy and Petroleum Regulatory Authority (EPRA) on Thursday, May 14, was already disrupting supply chains, raising production costs, and making daily commuting unaffordable for many workers.

📌 What You Need to Know

The adjustment drove fuel prices to Sh214.25 for super petrol, Sh242.92 for diesel, and Sh152.78 for kerosene — the highest ever recorded in Kenya.

KAM noted that fuel prices had risen by an average of Sh80 between March and May despite the government’s earlier decision to reduce VAT on petroleum products from 16 per cent to 8 per cent in April.

“Fuel prices have a far-reaching impact across the economy. They directly influence the cost of transportation, food production, agriculture, manufacturing, and the movement of goods and services nationwide, ultimately affecting the cost of living and the competitiveness of businesses,” the association said.

The manufacturers’ lobby issued the warning hours after talks between government officials and matatu operators collapsed publicly at Transcom House in Nairobi.

Energy Cabinet Secretary Opiyo Wandayi had earlier announced what he described as progress in negotiations, saying the government intended to narrow the price gap between diesel and kerosene.

“We have come to an understanding that for prudence purposes… we are going to bridge the gap between the prices of diesel and kerosene,” Wandayi said, indicating diesel prices would reduce while kerosene prices would increase.

📰 Source: Capital FM Kenya