Taifa Gas, Tanzania’s biggest gas dealer, is set to establish a plant within Kenya’s Export Processing Zone(EPZ).
The move is expected to trigger a fierce price war between Taifa Gas and local players-given its lower prices compared to brands sold by foreign and local monopolies operating in the Kenyan market.
Taifa Gas, owned by Rostam Aziz- a Tanzanian business magnate, is making its entry into Kenya as part of a trade deal between Kenya and Tanzania.
During recent bilateral trade negotiations between Kenya and Tanzania, held in Zanzibar, Kenya pushed for local carrier Jambo jet to be allowed to fly to several destinations in Tanzania. Kenya also wanted a waiver of fees charged on tourist vehicles dropping visitors on the Tanzanian side of the Namanga border.
Tanzania, likewise, raised several issues at this meeting, including delays in clearance of goods due to scanning procedures, delays in the issuance of import permits for dairy products exports, cumbersome procedures by the Kenya Revenue Authority and difficulties experienced by Taifa Gas Tanzania Limited investing in Kenya.
Local players in Kenya’s LPG market sell the commodity at prices seen as outrageous and beyond the reach of many low-income households.
Recently, Kenyan dealers increased the price of cooking gas by at least 15%, with the cost of refilling a 6kg gas cylinder rising to between KSh1,500 and KSh1,650 while refilling a 13kg cylinder rising to between KSh3,300 to KSh 3,500.
Taifa Gas, formerly called Mihan Gas, is the largest LPG supply company in Tanzania. The company, which has built 35 plants and storage facilities in Tanzania mainland and Zanzibar, is one of the companies founded and controlled by Rostam Aziz.
Rostam Aziz was formerly the largest individual shareholder of mobile operator Vodacom’s operations in Tanzania before selling his stake for more than $400 million.
He owns business interests in mining, port services, agriculture, media and an extensive real estate portfolio in Tanzania, the UAE and Oman.
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