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Economy

Kenya push for US trade talks to stir up EAC again

EAC member State flags
EAC member State flags: the customs union protocol requires joint negotiations since 2011. FILE PHOTO | NMG 

Kenya faces another tough task of convincing its East African Community partners to allow it pursue a trade agreement with the US even as a standoff persists over its duty-and-quota- free deal with Europe.

Last week, the Cabinet approved the start of talks on the establishment of a free trade arrangement between Kenya and US in a move likely to jolt the region’s economic integration.

The negotiations, expected to be launched this week when President Uhuru Kenyatta visits the US, “will help Kenyan goods to have smooth access to the expansive US consumer market especially as the African Growth and Opportunity Act (Agoa) pact comes to an end,” stated a brief from State House.

The move is set to draw a sharp reaction from other EAC members given that Kenya surrendered its customs space to the bloc in 2005 when it signed its customs union protocol. The rulebook compels member States to negotiate all trade pacts jointly.

“The EAC can only approve a free trade deal with Kenya if the resulting tariff regime is not in conflict with EA Customs Union Protocol,” Mr Kenneth Bagamuhunda, the EAC director-general for customs and trade told the Business Daily on Friday. “In fact, from 2001, the rule has been that any trade agreement with a third party must be negotiated as a bloc. This was a Summit (EAC Presidents’) decision.”

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Apart from Kenya, the EAC bloc has Tanzania, Uganda, Rwanda, Burundi and South Sudan as its other members.

The push by Nairobi to go alone on a post-Agoa deal with US comes even as Kenyan trade officials struggle to persuade the bloc to allow it to enforce Economic Partnership Agreement (EPA) as a single nation.

The EPA, which guarantees duty-free and quota-free access of EAC products to the European market, was finally signed and ratified by Kenya in October 2016, after a marathon negotiation from 2007.

Rwanda signed the deal but never ratified it while the rest of the EAC States are yet to sign it. Mr Kenyatta is expected to lead the push for a Kenya-only EPA at the bloc’s next Summit planned for February 29.

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