Kenya seeks reduction in Pakistan tea import duty

Pakistan is currently in an FTA arrangement known as the South Asian Association for Regional Cooperation (SAARC) under which dealing involve the free movement of goods between signatory countries through the elimination of tariffs, quasi-tarrifs and non-tariff restrictions on the movement of goods, and any other equivalent measures.

Some of the members in this FTA such as India and Sri Lanka directly rival Kenya in tea production, explaining the waning interest in shipments from Kenya.

The Kenyan-Pakistan trade ties are critical because the Asian nation traditionally takes a bulk of Kenya’s tea exports while a sizeable volume of its rice exports finds its way into the East African Community Market (EAC).

Rice imports

Only in June, Kenya and other EAC members handed Pakistan a major concession over tariffs charged on its rice imports.

For many years, Kenya and other EAC nations have pegged the common external tariff (CET) on rice imports at 75 per and an extra preferential 35 per cent import duty in line with the provisions of the harmonised community description and coding system.

But this arrangement was due for review upwards on June 30, 2009.

Kenya produces only about a third of its annual rice demand of 250,000 tonnes with a bulk of the shipments to fill the deficit coming from Pakistan alone.