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Some uncertainty as negotiations on the US-Kenya trade agreement proceed without a fixed timetable

Some uncertainty as negotiations on the US-Kenya trade agreement proceed without a fixed timetable
Published date:
Thursday, 20 July 2023

A recent report has shown that the United States is unsure when discussions for a free trade agreement with Kenya would be completed, notwithstanding the fact that Nairobi previously stated that the talks would be completed by December.

The United States Trade Representative Katherine Tai, who wrapped up a three-day visit in Nairobi on Wednesday, stated that the US negotiators do not have a timetable for ending discussions or signing the planned US-Kenya Strategic Trade and Investment Partnership (STIP).

“In terms of signature and when will we conclude, our focus right now is on substance as opposed to setting an actual deadline,” Ms. Tai said in a media briefing in Nairobi. “There’s a strong motivation on both sides to continue to build trade and economic relationships through these STIP discussions. So I am very encouraged with the engagement that we have had here and we will see how quickly we can move things forward,” she added. 

The proposed trade agreement is expected to protect Kenya in the event that the US Congress decides not to extend the African Growth and Opportunity Act (Agoa), which grants countries in sub-Saharan Africa duty- and quota-free access to the American market, when it expires in 2025. The proposed trade agreement does not include any tariff-related clauses.

  • The United States Trade Representative Katherine Tai confirms that discussions for the US-Kenya Strategic Trade and Investment Partnership (STIP) are ongoing, with no specific deadline set for conclusion or signature. 
  • The proposed trade agreement aims to protect Kenya's trade interests in the event of the African Growth and Opportunity Act (Agoa) not being extended beyond 2025. 
  • The US-Kenya trade talks, initiated in July 2022, continue to progress, with the first round of negotiations held in Nairobi, signaling the possibility of a comprehensive free trade deal between the two nations.

Moses Kuria, the cabinet secretary for trade in Kenya, had stated in March that he anticipated the discussions to be concluded in December, opening the door for the agreement to be signed by April 2024. Also, the National Assembly Committee on Trade, Industrialization, and Cooperatives reported in June that the Trade Ministry expected the negotiations to be concluded by December.

The first round of negotiations on the proposed trade agreement, which would serve as a model for the rest of the sub-Saharan African nations, took place between April 17 and 20 in Nairobi. Ms. Tai said continued negotiations on STIP were on the agenda for her visit to Nairobi. She co-led a meeting of the US-East African Community (EAC) Trade and Investment Framework Agreement (TIFA) Council on Tuesday.

“The large part of my being here is to enhance engagements and conversations on this strategic and investment partnership,” the US trade representative said. “Progress is going very well. I had good conversations with my counterparts and it was part of discussions with President Ruto as well,” she added. The top trade official for the US, however, did not meet Mr. Kuria.

The US exported commodities worth Sh93.43 billion to Kenya in 2022, while importing items worth Sh79.9 billion from Kenya. This trade imbalance favors the US. Under the Agoa deal, Kenya mostly exports clothing while purchasing pharmaceuticals and airplanes from the US.

The current discussions are a build-up to the bilateral agreement, whose parameters Kenya and the US began putting together in July 2022, just before the expiration of the term of former President Uhuru Kenyatta. To replace the two-decade-old Agoa, Kenya has long wanted a comprehensive free trade deal with the US, but progress has been slowed by administration changes in both nations.

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