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Economy

Uganda regains Kenya’s top export market position in race with Pakistan

Workers harvest tea at the Chesumot Farm in Kericho County. FILE PHOTO | NMG
Workers harvest tea at the Chesumot Farm in Kericho County. FILE PHOTO | NMG 

Uganda has regained its position as the biggest buyer of Kenyan goods after making orders worth Sh61.9 billion from Nairobi last year, fresh official trade data shows.

Kampala’s rise to the top export market position is at the expense of Pakistan, whose purchase of Sh59.39 billion worth of Kenyan goods last year was Sh4.67 billion (7.29 percent) less than its 2017 orders.

Uganda has been Kenya’s long-standing top export market, but tea exports to Pakistan have seen the Asian country challenge for the position in recent years.

The trade data released last week by the Central Bank of Kenya (CBK) showed that exports to Uganda had recovered from a two-year slide to record a slim 0.07 percent growth over the 2017 figure.

Kampala’s imports from Kenya – including edible oils, cement, steel, paper and medicines – have been narrowing over the years as investors set up factories in the land-locked country to manufacture goods previously ordered from Nairobi.

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Largest market

Islamabad in 2017 overtook Uganda, the USA and the Netherlands to become largest export market owing to increased orders for Kenya’s globally-acclaimed black tea of which the world’s six-most populous country remains the biggest buyer.

The US remained the third-largest buyer of Kenya’s goods with an order book of Sh47.34 billion, largely unchanged from Sh47.27 billion in 2017.

Exports to Washington were flat, growing 0.15 percent or Sh70 million despite President Donald Trump’s administration making it clear mid-last year that trade was its key agenda in Africa.

Trump’s regime warmed up to Nairobi last year by sending in two high-powered delegation on trade and security for bilateral talks with authorities in Nairobi.

The US Presidential Advisory Council on Doing Business in Africa (PAC-DBIA) – a think-tank which advises Mr Trump through his Commerce secretary Wilbur Ross – pitched camp in Nairobi from June 27-29 where initial deals worth nearly Sh10 billion were inked under the ambitious “Big Four” plan.

The Netherlands, which is Europe’s key entry point for Kenya’s cut flowers, remained the fourth-largest buyer of Kenyan goods in 2018 with a Sh46.36 billion order, a Sh2.47 billion or 5.63 percent growth over 2017.

Horticultural exports, dominated by cut flowers, were the only major agricultural shipments which posted a notable growth in earnings last year, rising 11.48 percent to Sh105.66 billion.

Coffee sales

Revenue from tea exports fell 5.71 percent to Sh138.84 billion in 2018 from Sh147.25 billion a year earlier while coffee sales were flat at Sh23.49 billion compared with Sh23.75 billion in 2017, the CBK data shows.

Exports to the UK went up 4.25 percent to Sh40.19 billion while Tanzanian orders edged up 4.26 percent to Sh29.73 billion.

Kenya has struggled to grow her exports over the years, widening her trade deficit to Sh1.145 trillion in 2018 from Sh1.13 trillion the year before.

Total exports rose 3.16 percent to Sh612.88 billion against a 1.88 percent growth in import bill to nearly Sh1.76 trillion.

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