Parliament in special meeting today over trade deal with EU

The National Assembly is Tuesday set to hold a special sitting to consider the ratification of the Economic Partnership Agreement (EPA) with the European Union as the deadline for the key deal looms.

Speaker Justin Muturi said the House, which has been on recess since September 1, will also discuss Senate amendments to the Physical Planning Bill and deliberate on the Constituency Development Fund (CDF).

Failure to sign and ratify the EPA by all the East African Community (EAC) states by September 30 will put about 200 Kenyan firms and four million jobs at stake.

“…two special sittings shall be held in the National Assembly chamber on September 20, 2016 at 9:30am and 2:30pm for purposes of consideration of the proposal to ratify the Economic  Partnership Agreement under the Cotonou Protocol between the Republic of Kenya and the European Union,” Mr Muturi said.

Kenya and Rwanda signed the EPA on September 1 in Brussels, Belgium, while Uganda and Burundi have indicated a willingness to sign.

The deal is expected to be ratified by each country’s legislature for it to come into force. Two weeks ago the EAC asked the EU to defer the September 30 deadline for three months to allow for more discussions with Tanzania which is yet to agree to sign the deal.

Failure to have all EAC countries sign and ratify the EPA will see Kenya — the only country in the region classified as developing — lose preferential treatment for its exports to the EU and have it slapped with Sh10 billion-a-year tax.

READ: EAC pushes back free trade pact with Europe to Jan

This would make its produce — mainly cut flowers, tea, fresh vegetables and coffee — uncompetitive in the EU market with major repercussions on the economy.

The EU market accounted for 32 per cent of Kenya’s Sh581 billion exports in 2015.

The rest of the EAC member states have alternative access to EU as they are classified as least developed.

Tanzania refused to sign the deal saying the move would jeopardise its nascent economic base as the EAC countries gradually open up to European imports over the course of a 25-year deal.

The discussions on CDF will likely centre on the legislators’ plan on how to circumvent a court order which capped the amount disbursed at Sh25 billion.

MPs last week met Treasury Secretary Henry Rotich and are looking at the option of having Sh10 billion released through a formula modelled on the Economic Stimulus Package (ESPs).

The High Court in June ruled that MPs can only access up to Sh25 billion being 2.5 per cent of the total annual revenue collected by the national government. This is well below the Sh35 billion budget that had been approved earlier.