The Central Bank of Kenya has denied claims by Deputy President Rigathi Gachagua that State Capture had crippled their operations so much so that they could not control Foreign Exchange reserves in the country.
Gachagua in an interview with Citizen TV on Sunday, October 2, had made the allegations forcing the CBK to swiftly respond to clarify the matter.
The second in command had faulted a group of cartels he said had held the banks hostage making oil importers heavily charged while importing oil products due to the high foreign exchange rates.
Read More
The DP blamed this for the skyrocketing prices of fuel in the country.
"Why there is forex exchange problem is because of state capture. There was a lot of interest in banks where very senior government people own certain banks and they got involved in this forex business. Central Bank so no longer in charge," Gachagua said.
In its clarification, the CBK noted that it does not control the forex exchange for commercial banks.
The CBK said it only manages the forex exchange for the national government and its operations.
"First, following the complete liberalization of the foreign exchange market in the 1990's, 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's operations. Oil importers, therefore, obtain their requisite foreign exchange from the commercial banks and not CBK," part of the statement read.
