Is Kenya abandoning trading blocs’ agreements for the US?

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With East Africa being one of the best-predicted performers this year, Kenya’s President Uhuru Kenyatta has been on a charm offensive for increased trade partnerships with different countries.

The latest of his forays have been in the US where he met with President Donald Trump discussing how to improve trade between the two countries.

Already, the US has amended its Air Transport Agreement to facilitate the movement of goods throughout the world by providing air carriers greater flexibility to meet their cargo and express delivery customers’ needs more efficiently.

Trading blocs agreements

“Specifically, the Amendment allows US all-cargo airlines to fly between Kenya and a third nation without needing to stop in the United States, an important right if operating a cargo hub,” adds the statement.

Kenyan all-cargo carriers have reciprocal rights to serve the United States.

Questions now abound over what happens to the trading blocs agreements that Kenya is part of since the East African economic hub seems to be unilaterally making decisions regarding trade partnerships.

Among the questions is if Kenya is going it alone leaving the rest of Africa behind.

To address this, Kenyatta says that a new bilateral trade deal between Kenya and the US will not undermine the African Continental Free Trade Agreement (AfCFTA).

Speaking shortly after the meeting with Trump at the White House, Kenyatta made the assurances that the new arrangement with the US is only aimed at bolstering and deepening trade not only with Kenya but also with other African countries.

He said Kenya’s commitment could not undermine the continental agreement which makes Africa the world’s largest free-trade zone.

In the meeting, Uhuru and Trump agreed to commence talks leading to a trade pact between Kenya and the US.

The two presidents said a new trade agreement would help increase volumes of trade and investment between Kenya and the US.

The US has for long reiterated recognition of Kenya as a leader in Africa and an important strategic partner.

US Trade Representative Robert Lighthizer said that a new trade agreement is an opportunity for the two countries to explore ways of deepening commercial and economic ties.

Lighthizer added that the US is looking for a template that can serve as a model for additional agreements across Africa.

This means that the US is looking to creating trade agreements with every strategic African nation to push its interests on the continent where China has a strong presence.

Notifying US Congress

With the progress so far, Lighthizer will officially notify Congress of the US government’s intention to start trade negotiations with Kenya. This is in line with the Bipartisan Congressional Trade Priorities and Accountability law of 2015.

Currently, trade between Kenya and the US stands at about USD 1billion a year with over 70 per cent of Kenya’s export into the expansive American market in 2018, worth USD 466 million, entering under AGOA.

Kenyatta told the Kenya-US forum that his government is committed to developing and concluding a strong trade and investment framework to increase trade between the two nations.

“These trade agreements would not only serve Kenya and United States but would probably set the base for a new engagement between the United States and other African countries,” President Kenyatta said.

Kenyatta said that the East African nation needs to move faster and set the pace for other African countries in formulating new trade and investment arrangements with the US. This as the African Growth and Opportunity Act (AGOA) comes to an end in 2025.

“Let them see us as the people who are clearing the field for future negotiations with the rest of the African continent because Kenya feels ready for this arrangement,” Kenyatta said.

Read: Why DR Congo is mulling joining the EAC

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