Market News

Pakistan overtakes Uganda as top market for Kenyan exports


A worker loading tea for auction and export. FILE PHOTO | LABAN WALLOGA | NMG

Pakistan overtook Uganda as Kenya’s biggest export destination in the first quarter of the year, boosted by growth in tea exports.

Exports to the Asian country rose by 21.5 percent to Sh16.86 billion from Sh13.87 billion in the corresponding period of last year.

The value of exports to Uganda marginally rose by 0.4 percent in the period to Sh16.68 billion.

Pakistan is the largest buyer of Kenyan tea, and volumes were expected to increase after the removal of the 0.5 percent attestation fee charged on tea export by Pakistan in August 2021.

Tea stakeholders had for years lobbied for the removal of the levy, which made Kenya’s tea more expensive in Pakistan compared with beverage from other countries.

Other top export markets included the Netherlands and USA which recorded purchases of Sh15.83 billion and Sh14.78 billion respectively.

During the period, however, the country’s trade deficit increased by Sh34.2 billion or 10.8 percent in the first quarter due to a surge in imports led by fuel and industrial supplies.

The country’s import bill rose by 16.6 percent to Sh591.6 billion, widening the trade gap to Sh351.54 billion despite a 26.3 percent growth in exports to Sh240.1 billion.

The economic recovery recorded last year as the country came out of the worst of the Covid-19 restrictions boosted demand, allowing factories to resume production that had been stunted in 2020.

Additionally, disruptions in the supply of wheat, palm oil and fuel due to the Russia-Ukraine conflicts have resulted to the higher cost of these commodities.

Imports of fuel and lubricants, and industrial goods rose by 64.2 percent to Sh126.1 billion and 17.2 percent to Sh237.1 billion respectively, pushing the deficit that was recorded at Sh317.3 billion in the same period last year.

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