• More tax subsidies to ease transportation
The government has confirmed an end to the prevailing fuel crisis, which has lasted over a month, by reaching a consensus with neighbouring countries to ease the transportation of oil products.
The development was confirmed yesterday by the Permanent Secretary in the Ministry of Trade, Commerce and Investment Promotion, Antoine Ruvebana.
According to Ruvebana, about 1.5 million litres of fuel was imported into the country over the weekend of which 1.2million litres were imported by private operators the rest by the government.
The imported fuel is the first consignment of the 24 fuel trucks that had left the Kenyan port of Mombasa for Kigali mid last week as part of the 12 million litres of fuel for the national fuel reserves.
“Fuel dealers mostly used the Tanzanian port of Dar es Salaam because it was easier than using the Mombasa port,” added Ruvebana.
According to the official, by the end of last week, private operators had no fuel left in their reserves and the fuel imported so far can serve the entire country for a period of two weeks but hastened to add that more fuel is expected to be imported and stocked by private operators.
Ruvebana also pointed out that, “the fuel that goes to the government reserves only serves in cases of emergency and the government is currently trying to refill its reserve for future emergencies.”
Asked how far with the process of hiring a private operator to assist in importing the 12 million litres of fuel to refill the government reserve, Ruvebana said that the tendering procedures would be completed Monday (yesterday) evening.
The process, according to Ruvebana is being handled by the Rwanda Public Procurement Authority; (RPPA) to supplement HASHI Impex the company that was contracted by the government to import fuel for the government reserves.
Ruvebana said that so far, four local fuel supplying companies have tendered in their bids of which only one will be selected.
Each of the two companies will import six million litres and according to Ruvebana this would expedite the process of having the fuel in the reserves in the shortest possible time.
HASHI Empex is a Kenyan based exporter of refined petroleum products in the East and Central African region. Meanwhile, fuel importation process has also been eased and the government has finally reached a consensus with the Tanzanian government to subsidize bond requirements for the transporters.
Initially, Rwanda had opted to import fuel through Kenya because the bond requirements were not as high as those of Tanzania.
“We have since been holding talks with Tanzania and the bond requirements have now been cut down which will ease getting fuel through Tanzania; this is one of the strategies we have drawn to ensure that there is no fuel crisis in the future,” said Ruvebana.
In Kenya, no truck was allowed to get fuel from the Mombasa port; all trucks were loading from the pipeline terminal in Nairobi or Eldoret.
“In monetary terms getting fuel from the two points of Nairobi and Eldoret is cheaper than getting it from Mombasa but there is no fuel at the pipeline terminal points!” Ruvebana said.
The terminals in Nairobi and Eldoret are run by Kenya Pipeline Company (KPC) and are currently over stretched by serving Western Kenya, Uganda, Rwanda, DR Congo, Burundi, Southern Sudan and northern Tanzania.
Asked how Rwanda is planning to overcome the problem of routing from Kenya, Ruvebana explained that his office and the Rwanda Revenue Authority were recently in Kenya to negotiate with Kenyan officials how the process can be revised and Rwandan trucks be let to get fuel direct from the port before it is pumped in the pipeline.
“I am happy to announce that we succeeded in this process and now Rwandan trucks can get fuel directly from the port,” he said.
On queries of whether this would not lead to an increase in the cost of fuel at filling stations, Ruvebana said that strategies had been laid out to overcome this.
“We have decided to cut more taxes on fuel transported from Mombasa so that the cost of fuel at a local market is not affected,” said Ruvebana.
Initially, the government had subsidized over 60 percent of taxes on import duty for oil products to tame the pump prices but this figure has since increased due to continuous cut in taxes.
Pump prices in Kigali for both Petrol and Diesel is Rwf756 a litre.