Malawi and Zambia, hit by fuel shortages, are in talks with Kenya as they consider replicating the arrangement where Nairobi directly imports petroleum products from producers in the Gulf.
Kenya ditched the Open Tender System that had been in use for importing fuel for nearly a decade in favour of direct procurement under a government-to-government(G-to-G) deal with Saudi Arabia and the United Arab Emirates (UAE).
“The countries have expressed interest in our G-to G deal, and we had officials in the country last week. They are learning from us on how we structured our deal. Malawi also requested if it could get a berth at the port for fuel,” an official at the Energy ministry said.
In the G-to-G deal, three Gulf state-owned firms—Saudi Aramco, Abu Dhabi Oil Company (ADNOC) and Emirates National Oil Company (ENOC)—were given leeway to hand-pick oil marketing companies (OMCs) to distribute fuel in Kenya on their behalf.
Energy Cabinet Secretary Opiyo Wandayi last week unveiled a Kenyan team to guide their counterparts from Malawi on how to structure a government-backed fuel importation deal.
“I have today commissioned a technical team that will explain to the Malawian delegation the structure of the G-to-G arrangement, challenges experienced and the mitigation measures put in place to counter the challenges,” he said.
Malawi, Zambia and Burundi are currently grappling with a fuel shortage largely attributed to a combination of lack of dollars to pay for the product and freight inefficiencies. The fuel crisis has led to skyrocketing pump prices.
Countries use the dollar to pay for fuel imports, highlighting why absence or inadequate supply of the greenback can disrupt supply, crippling economies.
