Kenya has recorded a major trade milestone after reaching a preliminary agreement with China that will allow most Kenyan exports to enter the Chinese market without paying import duty.
The deal gives Kenya significantly improved access to the world’s second-largest economy and is expected to boost exports, investment and jobs.
The breakthrough was announced on Thursday by Cabinet Secretary for Investments, Trade and Industry Lee Kinyanjui. He said Kenya had successfully negotiated an “early harvest” trade framework with China that grants zero-duty market access for 98.2 per cent of Kenyan goods.
The agreement follows China’s recent decision to extend duty-free and quota-free access to African countries, a move that largely favours Least Developed Countries while leaving developing economies like Kenya at a disadvantage. This policy meant Kenyan exporters were locked out of the preferential treatment enjoyed by several neighbouring countries.
“To mitigate this, we have initiated discussions with China to negotiate a bilateral trade agreement that aligns with the privileges enjoyed by our East African Community neighbours and other African nations,” Kinyanjui stated.
He confirmed that the talks had borne fruit, noting that the new framework corrects a long-standing structural imbalance in Kenya-China trade relations.
“We are pleased to share that these engagements have resulted in a preliminary agreement that allows for 98.2% zero-duty market access for Kenyan goods. This early harvest framework is a monumental progression that signifies China’s commitment to strengthening our trade ties further,” he said.
According to the Cabinet Secretary, the agreement lowers key trade barriers that have limited Kenya’s competitiveness in the Chinese market.
With tariffs removed, Kenyan products are expected to compete more favourably with exports from countries that previously enjoyed preferential access.
Agriculture
The agricultural sector is expected to benefit most from the deal. Agriculture remains the backbone of Kenya’s economy and a major source of employment. Products such as tea, coffee, horticultural produce, processed foods and other value-added goods are expected to see increased demand in China as exporters take advantage of reduced costs.
The Ministry of Investments, Trade and Industry projects that the expanded access will encourage higher production, attract investment into export-oriented industries and create jobs across supply and value chains. Increased exports are also expected to improve foreign exchange earnings and support broader economic growth.
“The introduction of zero-duty access will unlock vast economic potential for Kenyan exporters, allowing for diversification of our export basket, especially in the agricultural sector, which is the mainstay of our economy. This development is expected to generate considerable employment opportunities and bring tangible benefits to our economy,” the statement read.
The government says it will now work on the technical and regulatory processes required to operationalise the agreement and ensure Kenyan exporters are ready to take advantage of the new market access.
“In conclusion, the Government of Kenya remains committed to pursuing opportunities that enhance our trade capabilities and strengthen our partnerships on the world stage. We look forward to the positive impacts of this agreement on our economy and the wellbeing of our citizens,” Kinyanjui said.
Leave a comment