07-03-2022 by Leni Frau
Putin's Russia's war on Ukraine could create many more problems for Kenya than we think.
Beyond its support to the invaded country by the Kenyan delegate to the United Nations, which in addition to Russia has also put in discontent China, its main ally, Kenyan economists have warned that many prices of basic raw materials and other products that the country imports especially from Moscow will increase, with serious repercussions on the population and the economy of the country.
Not only that, Ukraine is also an important trade partner for Kenya, so as early as next week there will be increases on many goods imported from the two countries.
One of the main products imported from both Russia and Ukraine, for example, are fertiilizers for agriculture. Kenyan farmers and companies are already on the alert.
As early as next week, a fertilizer price increase is likely to come into effect and Kenyan farmers and producers are on high alert.
Professor Macharia Munene, a professor of history and international relations at United States International University (USIU), said the standoff is also likely to affect other key commodity prices such as oil and grains.
"Despite considering Ukraine distant from Nairobi," Munene said, "the fact that the global price of oil is going up has a negative effect and a direct impact on the Kenyan economy. For everything we import, the price will probably go up because of the problem in Eastern Europe."
But what commodities does Kenya import through the Russian and Ukrainian markets?
First of all, wheat. According to UN data, Kenya imported wheat worth 16 billion shillings in 2020. In addition, another important amount, estimated 1 billion shillings, was imported from Ukraine.
Kenya, in part due to climate change and increasing demand, cannot be self-sufficient with domestic production of wheat flour, which is used particularly for box bread, as well as chapatis, which are one of the most widely used street and subsistence foods among the population,
A disruption in wheat shipments from the two countries will make grain more expensive in Kenya at a time when Russia has imposed higher duties on exports to protect its local market. The increase in wheat prices has pushed up the cost of bread in Kenya for the first time in four years, hitting household budgets at a time when the price of milk has also risen.
Like wheat, maize is largely imported from Russia. The dish of ugali, the Kenyan polenta, is due to agreements between Moscow and Nairobi.
Already for some time the price of cornmeal per kilo, in supermarkets, has increased by at least 20% compared to 2021. Now, according to experts, the most common food of poor Kenyans could undergo other price changes, in negative.
Fertilizers have already been mentioned, the agriculture already tested by drought and scarce resources, will suffer further damage from the stop of imports from Moscow.
Ukraine and Russia are also the first exporters in Kenya of iron sheets and steel for processing. Construction will certainly be affected, and other markets will be sought to address the problem in a country where construction is a major growth driver.
Funnily enough, without exports from Russia, Kenya will soon suffer from a lack of packaging board. In fact, Russia is the largest exporter to Kenya, with 2.1 billion shillings in business annually.
Other products include oilseeds (Ukraine's largest exporter to Kenya). These are in particular sunflower seeds used for the oil that is the main resource for Kenyan cuisine, which does not use, except in restaurants and in the upper echelons of its social classes, olive oil. Finally, among vegetable imports from Russia, the important incidence of sweet potatoes, increasingly present in the diet of Kenyans, should be noted.
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