Economy

America lists trade deal with Kenya on its 2023 agenda

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President Joe Biden with President William Ruto during the U.S.-Africa Leader Summit on December 14, 2022, in the Diplomatic Reception Room of the White House. PHOTO | PCS

President Joe Biden’s administration has prioritised the proposed bilateral trade pact with Kenya in its agenda this year ahead of the September 2025 expiry of the duty- and quota-free deal.

Washington expects to “make rapid progress” in negotiating 11 pillars of the proposed US-Kenya Strategic Trade and Investment Partnership (STIP), which will replace the two-decade-old Africa Growth and Opportunity Act (Agoa).

The US negotiators held the first round of conceptual discussions with the Kenyan team led by Trade PS Alfred K’Ombudo in Washington between February 6-10 in Washington.

And now the US Trade Representative Katherine Tai has exuded confidence that Biden and Ruto’s administration will cover much ground in coming months after a slow start to the talks largely due to regime change in both countries.

“In 2022, we kicked off ambitious initiatives with Taiwan and Kenya to deepen our trade and economic relationships with both partners, and we aim to make rapid progress on both initiatives in 2023,” the Office of the United States Trade Representative wrote in the 2023 Trade Policy to the Congress on March 1.

“The STIP [proposed pact with Kenya] builds on our cooperation to date and will pursue enhanced engagement leading to high standard commitments in a wide range of areas with a view to increasing investment, promoting sustainable and inclusive economic growth, benefiting workers, consumers, and businesses (including micro-, small-, and medium-sized enterprises) and supporting African regional economic integration.”

The negotiating teams have been tasked to develop a roadmap for enhanced engagement on 11 pillars.

The areas of focus include facilitating trade in agriculture, fostering consumer, business and worker trust in the digital economy, protecting the environment, integrating micro, small and medium enterprises (MSMEs) into international trade as well as preventing and combating corruption.

“The Biden Administration also views this approach as one to be built upon to include other areas of mutual interest and to serve as a model for engagement with other willing countries on the African continent,” Ms Tai wrote in the report to the US lawmakers.

The current Agoa deal, a preference trade programme that allows duty- and quota-free access to the US market for sub-Saharan African countries, will expire in September 2025.

Trade between the two countries is tilted in favour of the US which exported goods worth Sh93.43 billion while buying merchandise valued at Sh81.18 billion from Kenya.

Kenya largely exports articles of apparel under the Agoa pact, while largely importing largely pharmaceutical products and aircraft from the world’s largest economy.

The discussions for the proposed bilateral deal started in earnest in August 2018 when former President Uhuru Kenyatta made a bilateral visit to the White House.

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