While the pandemic situation had already aggravated the economic condition of the African country, it had led to a number of hiccups in the various supply chains on which many products imported and exported from Kenya travel. Most notably, the price of cooking oil had almost doubled due to problems in the global palm oil supply chain.
Now, the conflict that erupted on Wednesday in Eastern Europe with Russia’s invasion of Ukraine could further aggravate the country’s economic situation.
The price of crude oil has shot up to $100 a barrel, the highest it has been since 2014, when oil inflation soared just as the previous conflict in Ukraine’s Donbas region erupted. This significant price increase, said Gichinga, economic director of Mentoria Economics, a business analysis consultancy, will have a heavy impact on commodity price inflation.
Also affecting commodity prices, again resulting in an increase, experts say, will be the shortage of imports and exports resulting from the conflict. Kenya has important trade relations with both countries. In particular, with Ukraine with which this year was estimated trade worth 250 million dollars, an increase of 92 million compared to last year, as communicated by the Ukrainian ambassador to Kenya, Andrii Pravednyk.
Exports of tea, flowers and fruit, worth billions of Kenyan shillings each year, are strong with both countries. In 2020, Kenyan farmers exported tea worth 5.2 billion shillings, flowers worth 2.6 billion and more than 900 million fruits such as avocados, pineapples, figs and dates to the two countries. Many farming families make their living from this trade.