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US trade with Kenya may be breeding some anxiety

US trade with Kenya may be breeding some anxiety

Business Insider Africa | 17th October 2023

By Chinedu Okafor

According to officials, even as trade and investment negotiations with Kenya continue, the US appears to be more interested in the African Continental Free Trade Area and the AGOA agreement.

The Kenya-US Strategic Trade and Investment Partnership (STIP) underwent another round of in-person negotiations last week (October 4-7) in Washington.

In the just-concluded round of negotiations, the two parties discussed draft texts pertaining to domestic service regulation, anti-corruption, and agriculture.

According to a statement from the Investments, Trade and Industry Ministry dated October 12, "They also continued their conceptual discussions on the subject of inclusivity in trade, specifically women, youth, and diaspora."

The delegation was led by Trade PS Alfred K’Ombudo and included representatives from his ministry, the State Law Office, the National Biosafety Authority, the Kenya Dairy Board, the Kenya Industrial Property Institute, the Kenya Agricultural and Livestock Research Organization, and the Kenya Plant Health Inspectorate Service.

Assistant Trade Representative Constance Hamilton served as the US’s group leader, and members of the delegation came from the US Departments of State, Treasury, Commerce, Agriculture, the Food and Drug Administration, the US Agency for International Development, and the Environmental Protection Agency.

However, it is becoming clear that the US is giving the African Growth and Opportunity Act, which is being proposed for a 20-year renewal, and the African Continental Free Trade Area (AfCFTA), which is presently being launched, a lot of thought.

The growing anxieties about Kenya going it alone on trade agreements, such as the Economic Partnership Agreement with the European Union, add to the peers in the East African Community’s concerns.

Along with Ghana, Cameroon, Egypt, Rwanda, and Tanzania, Kenya was one of the six nations selected last year to serve as the AfCFTA’s pilot member.

On July 14, 2022, Kenya and the US officially inaugurated the STIP with the intention of boosting investment, encouraging sustainable and inclusive economic growth that benefits employees, customers, and enterprises, and fostering African regional economic integration.

The EAC member states, led by Tanzania, are keenly observing the negotiations between the two nations as they move toward a 2024 deadline for signing an agreement.

Kenya wants to enter a bilateral agreement to gain access to at least 5% of the US market, which has the potential to bring in more than Sh2 trillion in export profits per year.

According to the Economic Survey 2023 published by the Kenya National Bureau of Statistics, the value of Kenya’s exports to the US increased 34% in 2017 to Sh79.9 billion from Sh59.6 billion.

 source: Business Insider Africa