Four People Killed In Kenyan Protests Over Surging Fuel Prices

(MENAFN- Live Mint) (Bloomberg) -- Four people were killed and 30 were injured as protests erupted in Kenya over soaring fuel prices and paralyzed public transport across major cities.

Bus and taxi operators called the strike from Monday to pressure the government to do more to offset the fallout from the war in Iran. Diesel costs have jumped 50% and gasoline prices 20% in the East African nation since fighting began on Feb. 28.

“Even though our constitution protects the right to demonstrate and picket, it is quite unfortunate that today's protests have, once again, been hijacked by political actors for political ends,” Interior Secretary Kipchumba Murkomen said in a statement.

About 230 people are under arrest, six officers were injured and six vehicles were damaged, including five belonging to the police, Nairobi Regional Police Commander Issa Mohamud told reporters earlier in the day.

The protesters used burning barricades and stones to block off major thoroughfares in the capital, Nairobi. Residents who use public transport were forced to walk to work, with the rioters turning back private vehicles trying to access the city center.

Kenya's mass-transit system relies heavily on private operators running fleets of diesel-powered buses and minibuses.

Global fuel costs have surged since the US and Israel attacked Iran, disrupting shipping through the Strait of Hormuz. The rising prices have intensified pressure on the import-dependent East African economy, which the International Monetary Fund already considers at high risk of debt distress.

The protests in Kenya follow similar unrest in Comoros. Last week a transport strike over steep fuel-price increases paralyzed the Indian Ocean archipelago and forced the government to temporarily backtrack.

To cushion Kenyan consumers, the government has halved value-added tax on fuel products and spent 11.2 billion shillings ($86.6 million) from its fuel-stabilization fund.

The government still has about 5 billion shillings remaining in the fund, which it plans to use during next month's fuel-price review, Treasury Secretary John Mbadi said in an interview with Nairobi-based Citizen TV.

Fuel Taxes

While pump prices remain high,“it must be recognized that the government is doing something,” he said.“If we didn't intervene as the government, our prices would be 80% higher.”

The industry has incurred losses of more than 500 million shillings and is prepared to continue the strike until fuel prices are reduced, Albert Karagacha, president of an association representing bus owners, told reporters.

The lobby has urged the government to drop all taxes on fuel, which account for about a third of the pump price. In addition to VAT, Kenya collects eight other levies including for road maintenance, petroleum development, railway development and an import declaration fee.

It has already securitized 28% of its road maintenance levy to repay commercial loans taken to pay down long-running arrears to road contractors.

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--With assistance from Mike Cohen.

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