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Economy

Kenya exports to Dar drop 34pc as standoff persists

A man ferries an assortment of cooking gas cylinders to customers in Ol Kalou Town in Nyandarua County. FILE PHOTO | NMG
A man ferries an assortment of cooking gas cylinders to customers in Ol Kalou Town in Nyandarua County. FILE PHOTO | NMG 

Kenya’s exports to Tanzania have dropped by 34 per cent in the first five months of the year raising concerns over negative impacts of the long-running trade standoff.

Exports to Tanzania plunged by Sh4.35 billion to Sh8.2 billion in the period to May compared to Sh12.55 billion recorded in similar period last year, shows data released on Friday by the Kenya National Bureau of Statistics (KNBS).

Tanzania has been Kenya’s second largest market in the region after Uganda, providing outlet for a range of products that include palm oil, soap, medical drugs, cooking fats, iron sheets, sugar confectionery, and margarine.

According to the KNBS data, exports to Uganda have continued to grow, firming up the country’s position as the single largest destination for Kenya’s manufactured goods.

Tanzania, on the other hand, has had a long-running market access war with Kenya, a stalemate that climaxed in May when the Energy Regulatory Commission banned gas imports through Namanga border post citing quality concerns.

Dealers from the neighbouring state say the ban has affected 40 per cent of the 100,000 metric tonnes of LPG imported into Tanzania in the period.

“Tanzania has been selling LPG to Kenyan companies for more than 10 years. This business is well-established. We have invested and continue to invest in infrastructure with a view of supplying the East African common market,” the traders said in a statement.

Tanzania responded promptly by blocking long life milk and cigarette exports from Kenya.

The stalemate has remained in place weeks after President Uhuru Kenyatta and his Tanzanian counterpart John Magufuli directed border agencies to end it.

Last week, trade officials from the two states, led by Kenya’s trade PS Chris Kitoo and his Tanzanian counterpart Adolf Mkenda held talks in Namanga in an effort to address the dispute that has rocked trade between the two states.

“This standoff has curtailed trade leading to a drop in business transactions between the two states since 2015,” said DR Kiptoo on Friday as he announced that a follow up meeting.

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