TRALAC - Trade Law Centre

How Zambia Can Fully Exploit AGOA Provisions

Sunday, 01 February 2004

Source: The Nation (Nairobi)

The Minister for Trade and Industry, Dr Mukhisa Kituyi, yesterday cancelled the trading license of a Chinese firm and ordered the arrest of its officials.

Dr Kituyi took the action against Lihua Garments Kenya EPZ Co Ltd over a Sh960-million scam at Mombasa port. The company, which manufactures garments for export to America under the African Growth and Opportunity Act (Agoa), was found to be importing ready-made garments.

"It is an extremely grave matter for this country if products being exported to America duty-free under the Agoa provisions are found to be trans-shipment from another country which is not one of the 39 countries that are supposed to export to US duty free," he said.

Dr Kituyi directed the immigration department to cancel residence visas of eight Chinese expatriates working with the firm with immediate effect. He said the Government would have lost more than Sh960 million if the garments had been reshipped to America.

Dr Kituyi said although the move would result in more than 400 employees losing their jobs, the Government action was justified and aimed at ensuring that Kenya did not lose out in the Agoa initiative.

The minister said the Government will close down the company's business in Kenya and any other company found to be involved fraudulent activities would be taken to court and their trading licences cancelled.

Kenya Revenue Authority officials have impounded 12 containers of ready-made garments worth over Sh960 million shipped into the country from China but declared as raw material.

On Thursday, the Export Processing Zones Authority chief executive, Mr Albert Gumo, suspended the firm's trading license pending further investigations.

He said the Government had launched investigations into a suspected multi-million shillings racket in which firms manufacturing garments for American market under the Agoa initiative imported ready-made garments for re-export.

Lihua Garments Kenya EPZ Co Ltd, is among more than 10 firms, which are manufacturing garments for the American market through the EPZ programme.

Yesterday Dr Kituyi said investigations into operations of firms manufacturing goods for the American market started late last following allegations of fraud by some of the EPZ firms.

He praised KRA personnel for unearthing the scam, but said activities of customs officers posted in the EPZs would be investigated to establish why they failed to unearth the scam.



Latest AGOA Trade Data on AGOA.info

Click here to view a sector profile of Kenya’s bilateral trade with the United States, disaggregated by total exports and imports, AGOA exports and GSP exports.


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Other regularly updated trade statistics on AGOA.info include:

  • All Countries’ AGOA and GSP Trade Overview

  • AGOA Trade by Industry Sector

  • Apparel Trade under AGOA’s Wearing Apparel Provisions (includes latest trade data for Kenya)

  • Latest Apparel Quotas under AGOA

  • Bilateral Trade Data for all AGOA-eligible countries individually.