President William Ruto said Thursday the government is exploring electric public service vehicles (PSVs) to keep the cost of transport down amid the global surge in petroleum prices.
Speaking at the Embu Stadium during the country’s 60th Madaraka Day celebrations, Ruto said reducing reliance on diesel and petrol is crucial if Kenya wants to tackle the escalating transport costs.
“As international petroleum prices continue to rise beyond reach, the cost of fuel locally rises steeply. Transport, as a component of household budgets, is affecting the cost of living. We have to liberate Kenyans from reliance on transport that depends on petroleum. For this reason, we are rolling out an electric vehicle public transport system which will bring down the cost of transport significantly,” he said.
The Head of State specifically pointed out the motorcycle taxi industry, locally known as boda bodas, as one of the major areas that the government is planning to roll out green vehicles.
“Our boda boda industry is about to experience inclusive transformation through the introduction of more efficient, affordable and clean vehicles. With this intervention, owning and operating a boda boda will become affordable, secure and profitable,” said Ruto.
At present, fuel prices are at an all-time high after Ruto’s administration removed a subsidy that had been in place since April 2021, which has in turn led to a rise in the cost of living due to increased manufacturing costs.
With a litre of super petrol retailing at Ksh.182.70 and that of diesel at Ksh.168.40 in Nairobi, the situation is expected to worsen in the coming months if crude prices in the global market do not ease.
This is also happening in the backdrop of a proposal to double the Value Added Tax on petroleum products from eight per cent to 16 per cent under the Finance Bill, 2023.
The bill, if adopted by Parliament, will further lead to higher fuel prices, even as President Ruto maintains the move was suggested by his economic advisory team in a bid to give the government Ksh. 50 billion.
“This 8 per cent we are adding will give us about 50 billion shillings and begin to deal with the problem of roads in our country, but to balance it out, I have removed on the same fuel, 3.5 per cent road development levy, 2 per cent of IDF, and removed 8 per cent VAT on gas,” Ruto said in a joint media interview from State House, Nairobi, on May 14.
