Kenya: 'AGOA doubts cut US exports by 12%'
Bilateral trade in goods between US and Kenya, by sector
Values are in $ '000
The volume of apparel shipped to the US under the African Growth and Opportunity Act (AGOA) declined by 12.1 per cent last year even as uncertainty clouds the 17-year-old preferential pact under President Donald Trump.
The 2017 Economic Survey shows apparel volumes exported declined to 74.4 million pieces in 2016 even as earnings increased to Sh35.2 billion on the back of weak shilling.
Under AGOA — a trade pact allowing US buyers to import goods from a number of sub-Saharan African countries without paying duty or facing quota restriction — the US has become Kenya’s largest apparel export destination.
Former US President Barack Obama extended AGOA to September 2025 allowing local entrepreneurs more time to benefit from the preferential trade pact.
There have, however, been fears that President Trump could either use executive orders to cut short that period or refuse to renew it upon expiry.
Textiles and apparel account for about 80 per cent of Kenya’s total exports to the US under the pact.
The Economic Survey shows direct employment generated by AGOA increased by 2.5 per cent to 42,645 people in 2016 while the number of enterprises operating at the export processing zones (EPZs) increased to 91 from the 89 recorded in 2015.
Total sales by the enterprises in the 65 gazetted EPZs increased by 5.8 per cent to Sh68.7 billion in 2016 from the Sh64.8 billion recorded in the year before.
The report says exports from the EPZs increased by 3.7 per cent to Sh63.1 billion, accounting for 91.9 per cent of the total sales.
Mid last year, the government exempted garments and footwear bought from EPZs from paying 16 per cent value added tax (VAT), in a move to make the products more affordable to Kenyans.
Trade barriers and duty free imports from Common Market for Eastern and Southern Africa states have been cited as the biggest impediments to growth of EPZs in Kenya.
With the country becoming more visible on the global map, local traders are increasingly opening more supply channels to the US, helped by increased interactions with American investors.
Conferences like the Global Entrepreneurship Summit that attracted Mr Obama have opened the much-needed avenues of interaction.
Last September, Kenyan authorities said they were looking to expand the list of products that the country exports.
Read related news articles
Kenya: 4th AmCham business summit to advocate for enhanced partnership and investment In US-East Africa trade
The fourth edition of the regional American Chamber of Commerce Kenya (AmCham) Business Summit, the premier platform for strengthening bilateral trade and investment between the United States, Kenya, and East Africa is set to be held on April 24–25, 2024, in Nairobi, Kenya. Kenya’s President William Ruto is confirmed as Chief Guest, leading a government delegation to the summit that aims to expand commercial opportunities and markets....
19 March 2024
US President Biden to welcome Kenyan President Ruto to the White House in May
President Joe Biden plans to welcome Kenyan President William Ruto to the White House in May, hosting a state visit after reneging on his promise to visit Africa last year. White House press secretary Karine Jean-Pierre said Friday that the visit set for May 23 will mark the 60th anniversary of U.S.-Kenya diplomatic relations and "celebrate a partnership that is delivering for the people" of both countries while affirming "our strategic...
18 February 2024
'Nigeria missing as Kenya, Ghana tap AGOA opportunities to boost foreign exchange earnings'
Africa’s biggest economy is still failing to tap the opportunities that the African Growth and Opportunity Act (AGOA) present to boost its foreign exchange, amid acute dollar shortages. The AGOA has been on for over twenty-three years as it was enacted in 2020. In 2015, the program was modernised and extended to 2025, implying that there are only about 15 months before the window closes. Some countries have taken advantage of the AGOA more...
05 February 2024
Kenya-US to deepen ICT, apparel and agriculture trade
Kenya and United States are in talks to identify areas of interest in information communication technology (ICT) sector that can interest US firms. A meeting between The US Ambassador to Kenya, Megan Whitman, and the Cabinet Secretary for Investments, Trade, and Industry Rebecca Miano, the states sought cooperation in six key areas. The meeting laid the groundwork for an enhanced collaboration between Kenya and the United States in...
09 November 2023
Kenya President Ruto joins US-Kenya business roadshow in San Francisco
Kenya's President William Ruto will address leading US technology companies and investors on Friday at the US-Kenya Business Roadshow in San Francisco organised by the American government’s Prosper Africa initiative. The roadshow - also co-organised by the US Embassy in Nairobi - highlights the business and investment potential in Kenya’s booming tech sector, a statement from the US Embassy in Kenya said. The event is part of a...
15 September 2023
AGOA boosts Kenya's textile exports to US, sector sees 7.2% growth
The African Growth and Opportunity Act (AGOA) has benefitted Kenya’s textile and apparel sector, leading to monthly exports to the tune of Sh4.5 billion, or Sh150 million per day, last year, according to a study by London-based Institute of Economic Affairs (IEA). The programme has had a positive impact on the country’s export-processing zones (EPZs), especially in the textile and garment sector. Kenya is the second-largest exporter of...
08 August 2023
Kenya's president meets US delegates on trade and investments
Kenyan President William Ruto has today held talks with US Trade Representative, Ambassador Katherine Tai. The discussions were based on US trade policy. Ruto said that the country is ready to strengthen the already existing relations between the two nations. "We will stretch our ties beyond the African Growth and Opportunity Act (AGOA) in the wake of advanced technology and climate change, for the full exploitation of our trade potential,"...
19 July 2023
US trade rep in Nairobi as Kenya's solo deals worry the EAC block [incl. Readouts]
The US trade representative is in Nairobi to co-lead a meeting that seeks Kenya's partnership in a fresh trade deal. The Trade and Investment Framework Agreement (TIFA Council) is pursuing various agreements even as regional peers express concern over Kenya's solo approach. Yesterday, Trade Representative, Katherine Tai met patron circle members of the American Chamber of Commerce-Kenya (AmCham Kenya) ahead of today's...
17 July 2023
US boosts Kenya apparel industry with $55m in new trade deals
The US is giving Kenya $55 million for expansion of export processing zones in a move that will boost Nairobi’s apparel exports. US initiative Prosper Africa and the US Embassy announced the funding at the launch of the US-Kenya Business Roadshow held on April 25 in New York. The announcement was part of the commitments made by President Joe Biden at the US-Africa Leaders’ Summit last year. The funds will be channelled under USAid and...
29 April 2023
Why Africa, why Kenya? Remarks by US Ambassador to Kenya
Thank you, Scott, for the kind introduction. It is a pleasure to partner with the Prosper Africa initiative to drive investment in Kenya and countries across the African continent. I am happy to kick off our U.S.-Kenya Business Roadshow with all of you today, and to announce that we will be partnering with Prosper Africa throughout the year to engage businesses and investors in cities across the United States. Our next stops include San...
26 April 2023
Kenya-USA: Joint Statement on the third US-Kenya bilateral strategic dialogue [incl. VIDEO]
The text of the following statement was released by the Governments of the United States of America and the Kenya on the occasion of U.S.-Kenya Bilateral Strategic Dialogue in Washington, D.C. on April 24, 2023. Begin Text: The Governments of the United States of America and the Republic of Kenya held the third iteration of the U.S.-Kenya Bilateral Strategic Dialogue in Washington, D.C. on April 24, 2023. The U.S.-Kenya Strategic...
24 April 2023