Kenya retains duty-free UK market access ahead of Brexit

Kenya retains duty-free UK market access ahead of Brexit

Kenya has retained its duty and quota-free access of the United Kingdom (UK) market ahead of the country’s looming no-deal exit from the European Union (EU) on December 31, 2020.

On Tuesday, Kenya’s Trade and Industrialization Cabinet Secretary Betty Maina indicated the country had reached a deal in principle replicating the effects of the East African Community (EAC) economic partnership agreement (EPA) with the EU.

“We have agreed on a comprehensive package of benefits that will ensure a secure, long-term and predictable market access for exports originating from the EAC Customs Union,” she said.

Among the greatest beneficiaries from the unrestricted market access will be flower and fresh produce exporters who have the UK as one of their major markets.

The new deal is seen as a win for Kenya which will continue enjoying similar trade terms with the 27-member EU.

Like its sibling, the EAC-EU EPA, the agreement allows for an immediate duty-free and quota-free access for exports while allowing EU imports into the region, partial/gradual access.

The EPA further bans unjustified or discriminatory restrictions on imports and exports between the pair as part of efforts to eradicate non-tariff barriers (NTBs).

Kenya has nevertheless negotiated the trade deal by itself as peers in the EAC customs union keep off the negotiation table as has been the case with the ensuing Kenya-US Free Trade Agreement (FTA) negotiations.

This is part of what seemingly appears as an ongoing marginalization of Kenya by its regional trade partners who have begun efforts to join the bandwagon to pursue common interests.

CS Betty Maina is however hopeful the countries can take advantage of the opportunity presented by Kenya’s new trade deal with the UK by joining the agreement to enjoy similar benefits.

“During the negotiations for this agreement, both Kenya and the UK demonstrated strong resolve to negotiate a trade and economic pact that respects the fidelity of the treaty establishing the EAC Customs Union, and provides room for access by willing EAC partner states,” she added.

Kenya enjoys a favourable trade relationship with the UK as it runs a balance of trade tilted to its advantage.

The country’s export to the UK was for instance valued at Ksh.40.1 billion in 2019 against corresponding imports valued at Ksh.35.3 billion in the same period.

Meanwhile, provisional data running in the year to August show Kenyan exports to the UK at Ksh.34.9 billion against imports of Ksh.18.9 billion.

The two countries are expected to agree on the finer details of the agreement which presently stands in principle before the close of the year.