TRALAC - Trade Law Centre

Kenya-US trade talks resume after hitch

Thursday, 06 August 2020 Published: | Martin Mwita

Source: The Star (Kenya)

Trade pact talks between Kenya and the US have resumed after stalling for several weeks, with the first round expected to be concluded in two weeks' time.

Industrialisation, Trade and Enterprise Development Cabinet Secretary Betty Maina yesterday said negotiators stopped two days into the talks, which formally kicked off on July 8, as Covid-19 concerns arose among the team.

“We were worried about Covid-19 among the negotiating team but we have now resumed,” CS Maina said.

The first round of the talks is expected to be concluded by August 14, the CS told the Senate Committee on Tourism, Trade and Industrialisation, chaired by Wajir senator Abdullahi Ali.

She indicated Kenyans could wait up to two years to have a complete Free Trade Agreement with the US.

“We are currently undertaking the first round. Negotiations take two years or more. No negotiation takes 30 days,” the CS said.

She said the negotiation team led by the US Trade Representative Robert Lighthizer and herself continues to receive recommendations from stakeholders on the objectives of the deal.

Nominated Senator Agnes Zani had sought an update on the trade talks and what Kenya is doing to ensure the deal benefits the country.

According to the CS, Kenya is keen to tap at least five per cent of the US market, which has the potential to earn the country more than Sh2 trillion in export revenues annually.

Last year, the country sold about $600 million (Sh64.7billion) worth of goods to the US, mainly textile and apparel, tea, coffee, fish products and nuts.

“One of our targets is to ensure we capture more market,” CS Maina said.

The Free Trade Agreement seeks to among others, ensure fair, balanced, and reciprocal trade between the two countries, increase transparency in import and export licensing procedures, and secure comprehensive duty-free market access for each country's products.

The Kenyan government is pushing to secure a free trade pact ahead of the lapse of the African Growth and Opportunity Act (AGOA) in 2025, which eliminates import tariffs on goods from eligible African nations.

More than 70 percent of Kenya's exports are duty-free under AGOA.

The US is keen to secure comprehensive market access for its agricultural goods in Kenya by reducing or eliminating tariffs.

The two countries also seek to develop rules of origin that ensure that the benefits of the agreement go to products genuinely made in the United States and Kenya.

The government (Kenya) has set up a technical support team of 90 experts to help with the negotiation process.

The Kenya-US deal has however been critisised by a section of African countries and the East African Community (EAC) bloc, arguing that it undermines the ongoing implementation of the African Continental Free Trade Area (AfCFTA).

The continental deal is aimed at accelerating intra-African trade and boosting Africa's trading position in the global market, by strengthening Africa's common voice and policy space in global trade negotiations.

CS Maina has however affirmed that the talks between Kenya and US will not undermine Kenya's previous agreements with regional and continental trading blocks.

In June, President Uhuru Kenyatta reiterated that the bilateral trade deal between Kenya and the US will be a win for Africa.

"Kenya will be the first under the new AfCFTA so we are going to be trailblazers in this and we hope that others will also follow through," President Uhuru said.

CS Maina virtually appeared before the Senate Committee to give an update on the performance of the ministry and deliberate on Covid-19 interventions.

Senator Abdullahi Ali said: “We will depend on you to do the right thing for this country,” referring to the ongoing trade talks.

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