The State Department for Trade has blamed lengthy consultations for the failure to establish commercial offices in three undisclosed countries last financial year in a bid to help traders to access new markets and diversify exports.
As part of a broader strategy to expand and diversify the goods and services Kenya sells abroad, the department had targeted to open the same number of offices to facilitate trade as it had done in the previous year ended June 2023.
Some 10 commercial offices were set up in the year ended June 2024.
“The target was not achieved. Consultations are still underway to establish more commercial officers,” the department wrote in a progress report to the National Treasury.
This came in a year when lawmakers demanded the Trade ministry conduct a comprehensive assessment on the qualification and suitability of commercial attachés in foreign countries.
The National Assembly’s Departmental on Trade, Industrialisation and Cooperatives had found that Kenya continued to struggle to find new markets for exports, largely farm produce, despite the commercial offices gobbling up a “huge share” of the ministry’s annual budget for allowances.
“The committee noted that the offices of trade missions are not achieving value for money spent on sustaining them abroad. In addition, a huge share of the budgetary allocation is spent on allowances of the trade attachés,” the committee wrote in a report ahead of the implementation of the 2023-24 budget.
“The offices are consuming resources without generating measurable returns, such as getting new markets for Kenyan exports.”
The Trade department has not disclosed the nature of consultations and whether they are related to demands from lawmakers who are mandated to approve annual budgets for State ministries, departments and agencies.
Kenya’s strategies to diversify export markets away from Europe and the US largely fall short despite concerted marketing campaigns.
Kenya in July 2018, for instance, unveiled the Integrated National Exports Development and Promotion Strategy in a bid to diversify its exports and expand destinations with a key focus on populous Chinese and Indian markets.
The country proceeded to appoint five ambassadors to the two giant Asian economies and tasked them with expanding the market for Kenya’s traditional exports of tea, coffee, cut flowers, vegetables and fruits such as avocados.
This was expected to narrow the goods trade deficit with the two countries that have over the years accounted for about 40 percent of exports into Kenya on average while buying less than two percent of goods with containers going back largely empty.
Latest data from Kenya National Bureau of Statistics shows that the goods trade deficit with China, for example, widened to Sh408.45 billion in nine months ended September 20424 from Sh304.24 billion in a similar period a year earlier.
“An assessment should be conducted to determine if there is linkage between the foreign markets and the skills possessed by the attachés stationed abroad,” the committee recommended in its report after the ministry made a presentation on budgetary allocations for the financial year starting July.
“This should be achieved by matching the expertise and capabilities of the attachés with specific demands and requirements of the target markets.”
President William Ruto has in the past pledged to help farmers find new markets abroad for their products in a bid to grow earnings from exports.
“We must turn agriculture into a commercial economic activity,” Dr Ruto said at a past forum. “We should allow our farmers to earn more from their sweat by exploiting new and lucrative markets for them.”