In response to the escalating geopolitical tensions in the Middle East and its ripple effects on the global economy, the Government of Kenya is continuously assessing the impact of the conflict and disruptions to global supply chains on the domestic economy and actively managing developments.
The ongoing conflict in the Gulf region has introduced significant disruptions to global trade networks, mounting pressure on economies worldwide. While Kenya is not immune to these external shocks, the Government has maintained a posture of vigilance, actively managing developments through continuous assessments by key ministries and agencies.
G-2-G Fuel Arrangement Mitigates Immediate Shocks
Following a comprehensive briefing from the Ministries of Energy, Agriculture, Trade, the National Treasury, the Central Bank of Kenya, and representatives from the private sector, President William Ruto confirmed that the Government is moving decisively to address the situation. In the petroleum sector, authorities are carefully assessing the impact of rising international oil prices on Kenya’s economy.
To cushion Kenyans from immediate price shocks, the President highlighted that the Government-to-Government fuel procurement arrangement mitigates against immediate shocks. The Ministry of Energy continues to monitor international fuel prices closely and is working with the National Treasury to implement further appropriate interventions as needed.
On the agricultural front, the Government has moved to reassure the nation regarding the supply of fertiliser, stating that no disruptions are anticipated. Current stocks are sufficient to support the ongoing rainy season through to September, thereby securing a critical input for food production.
In the trade sector, while certain key exports, particularly tea, were expected to encounter challenges in some international markets, the performance has remained resilient. This stability has been bolstered by deliberate efforts to diversify export destinations and strengthen existing trade relationships. The latest data indicates that 81 percent of tea offered for auction this month was successfully exported, and a notable increase from 75 percent recorded in March 2025.
Additionally, Kenya’s strategic port infrastructure has also demonstrated remarkable resilience amid regional instability. Activity at the Ports of Mombasa and Lamu has seen significant growth, with the Port of Lamu recording a sharp increase in throughput, including the handling of over four thousand high-value motor vehicles destined for Gulf markets for onward transshipment.
This development underscores the strategic importance of continued investment in port capacity and efficiency. Looking ahead, the Government plans to engage international logistics companies to leverage emerging opportunities and further strengthen Kenya’s position in regional and global trade.
Nevertheless, the Government acknowledged that the meat export sector has faced challenges linked to logistical and freight constraints arising from the regional situation. In response, the Ministries of Trade and Agriculture are set to collaborate on exploring alternative solutions to support exporters in this sector. Throughout these efforts, the Government has reaffirmed its commitment to closely monitoring developments and taking decisive action to protect the economic well-being of all Kenyans.
