What you need to know:
- President Kenyatta and Trump said a new trade agreement would help increase volumes of trade and investment between Kenya and the US.
- President Kenyatta dismisses speculation that Kenya is breaking away from its commitment to the African Continental Free Trade Agreement.
- He said the new arrangement with the US is only aimed at bolstering and deepening trade not only with Kenya but also with other African countries.
President Uhuru Kenyatta has assured that a new bilateral trade deal between Kenya and the US will not undermine the African Continental Free Trade Agreement (AfCFTA).
Mr Kenyatta spoke shortly after a meeting with the US President Donald Trump at the White House in Washington DC on Thursday.
During the meeting he two leaders agreed to start talks leading to a trade pact between Kenya and the US.
President Kenyatta made the assurance when he addressed over 350 business leaders attending a US-Kenya Trade Forum in the US capital.
He said the proposed new trade arrangement with the United States of America would in no way undermine Kenya’s commitment to the African Continental Free Trade Agreement (AfCFTA).
At the meeting, Kenyatta and Trump said a new trade agreement would help increase volumes of trade and investment between Kenya and the US.
US Trade Representative Robert Lighthizer who spoke shortly after the meeting between Presidents Kenyatta and Trump said, America recognizes Kenya as a leader in Africa and an important strategic partner of the US.
He said a new trade agreement presents the two countries a rare opportunity to explore ways of deepening Kenya-US economic and commercial ties.
“Under President Trump’s leadership, we look forward to negotiating and concluding a comprehensive, high-standard agreement with Kenya that can serve as a model for additional agreements across Africa,” Amb Lighthizer said.
In line with the Bipartisan Congressional Trade Priorities and Accountability law of 2015, the Trade Representative will now officially notify Congress of the US government's intention to start trade negotiations with Kenya.
Currently, trade between Kenya and the US stands at about $1 billion a year with over 70 percent of Kenya's export into the expansive American market in 2018, worth $466 million, entering under AGOA.
President Kenyatta told the Kenya-US forum that his administration is committed to developing and concluding the strongest ever trade and investment framework that would deliver increased trade between the two nations.
“Today I want to assure all of you of Kenya’s unwavering commitment in developing the strongest ever trade investment framework with the United States of America.
“We are very keenly looking forward to concluding the trade arrangement between our two countries and I believe that 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.
He dismissed speculation that Kenya is breaking away from its commitment to the AfCFTA saying the new arrangement with the US is only aimed at bolstering and deepening trade not only with Kenya but also with other African countries.
“At this juncture I just want to put away a few doubts because there has been a feeling that by Kenya engaging with the US to have a trade arrangement, we are running away from our commitment to the African Continental Free Trade arrangement. And I want to assure you that there can be nothing further from the truth as that is definitely not the case,” President Kenyatta said.
Mr Kenyatta pointed out that Kenya was among the first countries to sign and ratify the AfCFTA and that its commitment to the agreement is steadfast.
He said Kenya needs to move faster and set the pace for other African countries in formulating new trade and investment arrangements with the US as the African Growth and Opportunity Act (AGOA) comes to an end in 2025.
He noted that even as Kenya and the US work to strengthen their trade and investment ties, there is need to preserve and build on mechanisms and regulatory frameworks that already exist.
“As you may be well aware, the AGOA has been a key mover for trade between Kenya and the USA. Through AGOA, the US is the third export destination for Kenyan products, with a share of about 8 percent of total Kenya’s export globally.
“Moving forward, we need to maximise the remaining years of the AGOA that ends in 2025,” President Kenyatta said noting that the US is an important source of Kenya’s foreign direct investments (FDI), with the country holding an FDI stock of over $405 million in 2018.
President Kenyatta challenged American businessmen to explore new investment opportunities in Kenya and assured them of an enabling business environment.
“We have a wide range of potential areas for investment and I urge US companies to consider investing in key sectors of the economy such as; Agriculture & Agro-processing, Manufacturing, Construction and Real Estate development, infrastructure development, ICT, Blue Economy, Energy, Hospitality and Tourism, Health, FinTech & Financial Services, Petroleum, Mining, among others,” the President outlined.