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Kenya–US resume physical trade meetings

Kenya–US resume physical trade meetings

The Star | 13th December 2022

By Martin Mwita

Trade talks between Kenya and the US are back on track with full resumption of in-person meetings after a six-month break following Kenya’ s elections and change of administration.

Expanding bilateral trade, inclusion of women and youth and supporting Micro, Small and Medium Enterprises will form the initial stages of the resumed talks under the Ruto administration.

The last physical meeting was in mid June when the US Trade Representative Katherine Tai and former Industrialisation and Trade Trade Cabinet Secretary Betty Maina, met on the sidelines of the WTO Ministerial Conference in Geneva.

President William Ruto who is leading a delegation to the US-Africa Leaders Summit in Washington is keen to have the deal expedited, as he seeks more trade deals with the US.

On Tuesday, Investments, Trade and Industry Moses Kuria had the first in-person meeting with Tai and her deputy Ambassador Sarah Bianchi.

In a joint statement on Tuesday, the two sides said the initiative aligns with the Ruto administration’s domestic objective of greater economic inclusiveness.

"We discussed on plans to begin expert engagements on issues we had earlier identified during our virtual meeting,”Kuria said, which will also include advancing the African Continental Free Trade integration.

This now sets the stage for a full resumption of the talks which have been disrupted twice by elections.

Talks began in July 2020 during former Presidents Donald Trump and Uhuru Kenyatta’s tenures.

After the US elections in November 2020, Joe Bidens’s administration took time to review part of the pact before initiating a fresh round of negotiations. This however stalled this year when Kenya went into an election.

In what would be a sign of goodwill by Biden to push for more trade collaboration with Kenya, the US President sent Tai to lead the country’s delegation to Ruto’s inauguration on September 13. This was followed by two key visits by delegations from the US at State House Nairobi, before Ruto headed to the Washington summit.

Biden is hosting leaders from Africa between December 13-15, a forum the US is keen to use to strengthen its partnership with Africa.

Focus areas include economic engagement, peace, security and good governance, democracy and human rights, regional and global health security (including post Covid recovery and pandemic preparedness), food security, climate change, and education and youth leadership.

Kenya, however is keen to secure a preferential trade agreement before the African Growth and Opportunity Act (AGOA) lapses in 2025.

According to trade experts, it takes up to two years to have a complete FTA (Free Trade Agreement) meaning the two countries could have a deal by 2024.

The AGOA program gives Kenya and 40 other sub-Saharan African countries duty-free access to the US market for over 6,000 products.

More than 70 percent of Kenya’s exports to the US are duty-free under AGOA.

With a bilateral deal, Kenya is keen to tap at least five per cent of the US market, which has the potential to earn the country more than Sh2 trillion in export revenues annually.

Last year, Kenya’s exports to the US grew to Sh59.5 billion, up from Sh49.3 billion previous year, with increases in the exports of macadamia nuts and articles of apparel and clothing accessories.

The US is the largest export destination of Kenya’s apparel, accounting for over 90 percent of garment exports every year, a sector that stands out as the biggest beneficiary in an improved trade environment under the FTA.

 source: The Star