TRALAC - Trade Law Centre

Horticulture, tourism to gain from direct Kenya-US flights

Monday, 28 May 2007

Source: The East African (Kenya)

Trade between Kenya and the US is set to increase with the expansion and upgrading of JKI Airport to category A status.

The Permanent Secretary in the Ministry of Trade and Industry, David Nalo, said the airport’s new status, expected as early as 2009, will allow direct horticulture exports and increase the flow of tourists. This will follow compliance with security requirements.

The official said this presents the country with the opportunity to diversify its export base away from textiles and apparels under the Africa Growth and Opportunity Act (Agoa) protocol.

Mr Nalo was speaking on international trade issues and implications for Kenya, East Africa and Africa under the theme “Emerging Trends in International Trade” during the 23rd annual Institute of Certified Public Accountants of Kenya (ICPAK) workshop at Sun ‘N Sand resort in Kilifi.

The theme of the three-day workshop was “The Changing Global Arena: Road Map for professional accountants in Emerging Economics.”

Mr Nalo said Kenya stood to benefit more under Agoa by encouraging value addition to its exports and improve on professional competencies in all trade services.

He said the main challenge facing Kenya on Agoa is production competitiveness. The distance from Africa to the US puts Kenya and other African countries at a disadvantage, translating to high costs of production.

He said countries such as China that have efficient sources of production, high productivity systems and reliable logistical organisation are doing far much better than Kenya.

Mr Nalo said the US market has spurred interest toward the development and marketing of other products in the country such as ready- to-drink teas as well as repackaging or branding of Kenyan products, not only for the US market but also the rest of the world.

The seminar participants heard from Martin Kisusu, a partner with Deloitte and Touche, that the port of Mombasa could be forced to close down if it fails to meet global requirements of being compliant with the International Ship and Port Security Facility Security Code (ISPS) as demanded by the International Maritime organisation and the World Customs Organisation.

The port is behind schedule by three years in meeting international port security requirements.

Mr Kisuu said that as the country embraces international trade, it must also ensure compliance with the US Customs and Trade Partnership Against Terrorism, among other requirements.

He said the port of Mombasa remains non-complaint to international requirements which could make it impossible for goods shipped through it to be allowed elsewhere in the world.

He said the effect of global trade made it mandatory for Kenya to fully comply with the rules or be cut out from the rest of the world. He further cited container security initiative, 24-hour manifest regulations, free and secure trade and international shipping and port security, as some of the requirements.

Mr Kisusu said with the upgrading of JKIA to class A, “We are going to have Customs officers from the US at both the airport and port of Mombasa if we are to export anything to the US or any other country which the US has an interest in,” he said.

The port of Mombasa could soon find itself being subjected to the international rules due to the fact that it handles goods from regions that suffer from high insecurity such as the Democratic Republic of Congo, Southern Sudan and other conflict countries in East and Central Africa.

Currently, Customs officers at the port of Mombasa use scanners on all containers passing through the port as a security requirement, causing serious congestion.

At the close of the seminar, the accountants proposed to join the East and Central Africa Accountants Federation. Already, the Institute of Certified Pubic Accounts (ICPAK) has been mandated to start working on harmonising a qualifications framework to govern the profession.

The chairman of ICPAK, Joe Wangai, said the formation of an Africa-wide regional accountancy body will make it possible for accountants to work anywhere in the region. He said this will help in cross-border operations.



“ Latest AGOA Trade Data currently available 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.


Other regularly updated trade statistics on AGOA.info include: (click each link to view)

  • AGOA-Beneficiary Countries’ AGOA and GSP Trade Aggregates

  • AGOA Trade by Industry Sector

  • Apparel Trade under AGOA’s Wearing Apparel Provisions

  • Latest Apparel Quotas under AGOA

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