Kenya has increased the bond fee for imported fuel consignments bound for Uganda, raising it to $45 million. This move by Kenya poses a challenge to Uganda’s plans of reducing fuel prices for consumers. The bond fee is a bank guarantee used by oil companies to secure duties and taxes payable to the revenue authority if the goods are not exported.
Minister Ruth Nankabirwa stated that the increase in bond fees at the Vitol Tank Terminal International (VTTI) storage facility in Mombasa will impact pump prices in Kampala. The fees, now at $45 million, will lead to additional costs incurred at the port, affecting consumers in Uganda.
This development is part of larger issues between the two countries regarding fuel importation processes. Uganda has aimed to lower pump prices by importing fuel directly, but challenges from Kenya persist, including delays and higher fees.
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