TRALAC - Trade Law Centre

US now second biggest buyer of Kenyan products

Friday, 06 February 2015 Published: | James Waithaka

Source: The Star (Kenya)

The value of Kenya's exports to United States increased by nearly a third in the first 11 months of 2014, rendering the US her second most important market after Uganda.

Latest official data show the US bought goods worth Sh35.53 billion by November, 28.5 per cent higher than the Sh27.64 billion raked in over a similar period in 2013.

The US is catching up fast with Uganda, the biggest buyer of Kenyan goods, but whose purchases over the period slumped by 11.4 per cent to Sh43.31 billion, from Sh48.87 billion in the previous year.

USA has leapfrogged the United Kingdom, Tanzania and Netherlands from the fifth position in 2013. This has been attributed to favourable trade policies between it and the African continent, notably through the African Growth and Opportunity Act, which offers export incentives on many commodities.

Kenya's imports from the US have also grown rapidly over the same period, owing to capital goods such as aircraft, locomotives and spare parts.

In the 11 months, Kenya's total purchases from USA were worth Sh162.58 billion, more than triple the Sh51.42 billion worth of goods shipped in by end of November 2013.

The AGOA deal is set to expire on September 30 after a 15-year run, which is likely to put a damper on Kenya's exports to the US if not renewed.

 

 

Kenyan trade officials are nonetheless optimistic that it will be renewed by then despite the bureaucracies involved.

"This is not the first time we have been in a situation like this; it's not an easy process to make recommendations and get institutions that have to approve, especially like the Congress," Moses Ikiara, managing director of Kenya Investment Authority, told the Star in the sidelines of a Federation of Kenya Employers conference two weeks ago.

Under the Act, Kenya exports tonnes of textiles and clothing to the US but barely utilises its quota fully.

Ikiara said there are plans to host a Kenya-US business conference in Nairobi in September as a follow up to a US-Africa Business Summit held last August.

"Kenya is fast emerging as a major business partner for the US, and as the rest of Africa, it is becoming more important. To manage the trade imbalance, there must then be a chance to export to the US through arrangements such as AGOA," he said.

Under AGOA, Kenya can export up to 6,000 different products but only does a few currently, in what Ikiara cites as "domestic supply constraints". The country must thus build a critical mass of the various goods allowable to make sense of exporting, he said, including standardisation.

"It is not so much about market access," Ikiara, adding that KenInvest, Ministry of Foreign Affairs and International Trade, and embassies are coordinating to benchmark progress on extension of the trade pact.

 

View related news articles

'The opportunities are vast in a potential US-Kenya FTA'

'The opportunities are vast in a potential US-Kenya FTA'

Last year, the U.S. and Kenya announced the launch of free trade negotiations, the first of its kind between the U.S. and a sub-Saharan Africa country. If successful, it would be the most significant trade development in the region since the enactment of the African Growth and Opportunity Act (AGOA) trade preference program in 2000. To better understand the key issues...

06 May, 2021
Report: A look at the potential benefits and challenges of a US – Kenya trade agreement

Report: A look at the potential benefits and challenges of a US – Kenya trade agreement

The American Chamber of Commerce (AmCham) Kenya has partnered with the U.S. Africa Business Centre (USAfBC) and Covington to publish a business trade report. The report, titled US-Kenya Trade Negotiations: Implications for the Future of the U.S.-Africa Trade Relationship, examines the challenges and benefits of a potential free trade agreement (FTA) between the...

30 April, 2021
Kenya: 'Uhuru–Blinken talks a breath of life to US trade deal'

Kenya: 'Uhuru–Blinken talks a breath of life to US trade deal'

Trade talks between Kenya and the US could resume soon following Tuesday's virtual meeting between President Uhuru Kenyatta and US Secretary of State Antony Blinken. This is after a five-month break occasioned by change of g-uard in the US as President Joe Biden took over from Donald Trump after last November’s elections. The settling down of the Biden administration put...

29 April, 2021
'Biden Administration dampens Kenya's hopes for bilateral trade deal'

'Biden Administration dampens Kenya's hopes for bilateral trade deal'

The Biden administration's plans to review foreign trade policy and refocus it on America's economic recovery have thrown long-running free trade negotiations with Kenya into disarray. In a development that casts doubts on the future of a bilateral free trade agreement (FTA) with Kenya, United States Trade Representative Katherine Tai has informed Kenyan Minister...

05 April, 2021
'Uncertainty around Kenya-US Free trade deal'

'Uncertainty around Kenya-US Free trade deal'

A cloud of uncertainty has engulfed Kenya’s pursuit of a free trade agreement (FTA) with the United States due to the impending change of guard at the White House.  Even before he takes office, President-elect Joe Biden has sent strong indications of plans to annul many of President Donald Trump’s policies, cutting across trade, environment and geopolitics...

18 January, 2021
Kenya exports to US climb to Sh67 billion

Kenya exports to US climb to Sh67 billion

Kenyan exports to America under the Africa Growth Opportunities Act (AGOA) hit Sh67 billion last year, a marginal increase of 3.7 per cent from Sh64 billion recorded in the previous year. According to the latest report from the Office of the US Trade Representative, Kenya emerged the fourth exporter under Agoa, after Nigeria (Sh310 billion), South Africa (Sh200 billion) and...

30 December, 2020
Opinion: 'Kenya-US relations really do matter'

Opinion: 'Kenya-US relations really do matter'

With the shadow of the bitterly contested American presidential elections looming over us, the past few weeks have seen much discussion on the relationship between Kenya and the US. The average American may not care much who gets to be the president of Kenya – indeed would generally have no idea of it, if there was a presidential election taking place in Kenya. But most...

05 November, 2020
'From AGOA to FTA - Kenya-US ties growing from strength to strength'

'From AGOA to FTA - Kenya-US ties growing from strength to strength'

[Opinion] The 56-year-old United States-Kenya relationship flourishes because we trust each other, respect each other and our nations share common values. Both believe in a strong economy through an open, free marketplace allowing entrepreneurs, businesses and the private sector to thrive and create jobs. The African Growth and Opportunity Act (AGOA) enhanced markets,...

29 October, 2020
Members of Congress warn Trump not to push for plastic concessions in Kenya trade talks

Members of Congress warn Trump not to push for plastic concessions in Kenya trade talks

Leading US politicians have urged President Trump to oppose the export of more plastic waste to Africa after an investigation by Unearthed and the New York Times revealed oil industry attempts to influence a US-Kenya trade deal. In a letter released after the investigation landed on the front page of the New York Times, one Republican and 61...

02 October, 2020
US-Africa trade relations: 'Why is AGOA better than a bilateral free trade agreement?'

US-Africa trade relations: 'Why is AGOA better than a bilateral free trade agreement?'

In recent months, the U.S. began negotiations for a bilateral free trade agreement with Kenya. These negotiations are aligned with the current administration’s vision for trade reciprocity rather than unilateral trade preference programs. Although these negotiations could produce the first bilateral trade agreement between the U.S. and a sub-Saharan African country, a...

24 September, 2020
'Proposed trade between Kenya and US might bring more harm'

'Proposed trade between Kenya and US might bring more harm'

On February 6, President Uhuru Kenyatta met with US President Donald Trump at the White House. Following the meeting, the two presidents announced their aim to pursue a free trade agreement between the two countries. By March 2020, President Trump had notified Congress of his intention, the key goal being cited as the need to reach an agreement that builds on the objectives...

20 September, 2020