In the run-up to its expiration in 2025, the African Growth and Opportunity Act (Agoa) is causing the Kenyan government to actively pursue trade agreements with the US. The goal of the talks is to strengthen and expand trade ties between the two nations.
The new accords would enhance and broaden economic prospects between Kenya and the US, according to Cabinet Secretary for Trade, Industry, and Investments Salim Mvurya Friday.
The discussions center on a Strategic Trade and Investment Partnership (STIP), encompassing several important domains like customs processes, digital trade rules, sanitary measures, agriculture, and climate change action. The talks include a number of important topics with the goal of boosting investment and commerce between Kenya and the US. These include faster customs procedures to promote trade, agricultural initiatives, and sanitary steps to guarantee the safety of exported commodities, according to Mvuria.
According to him, the alliance will help micro, small, and medium-sized businesses and refine service laws to enhance the investment environment and combat climate change through collaborative efforts.
Aligning laws and regulations with digital trade is another crucial area of work in order to promote more seamless and integrated commerce.
To further the negotiations, the Kenyan group met with representatives from the US Trade Representative’s Office in Nairobi, led by Principal Secretary Abubakar Hassan of the State Department for Investment Promotion.
Increasing investment, fostering sustainable economic growth, and bolstering regional economic integration in Africa are the objectives of the STIP.
Agoa, a US trade statute passed in 2000, has allowed duty-free access to the US market for specific items for nations in Sub-Saharan Africa that meet the requirements.
It was once scheduled to run from October 2000 to September 2008, however it has since been extended multiple times, the most recent of which runs until September 2025.
Boost commercial ties
It is anticipated that the new collaboration will expand on Agoa’s achievements and tackle a number of areas, including assistance for micro, small, and medium-sized businesses.
Mvurya emphasized that strengthening trade and economic ties between Kenya and the US will be greatly aided by the initiative.
The protracted trade negotiations occur at a time when, in response to growing Chinese influence in the region, the Biden administration has been strengthening its economic and security relations with the largest ally in East Africa.
A leading US trade congressman and one of the largest and most powerful US business lobby groups have pushed the Biden administration to expedite the Trump-era trade negotiations with Kenya in order to increase pressure on Washington to wrap up the talks.
Additionally, they want Washington to hold talks with Nairobi based on the original model—which was first suggested by Biden’s predecessor—of a free trade agreement with Kenya.
They claim that such a trade agreement will open doors for commerce and investment between US companies and their local equivalents, benefiting Kenya as well as the US.
In July 2020, Kenya and the US formally began discussions for a bilateral trade deal, with the intention that it would serve as a template for further trade accords throughout the African continent.
The proposed free trade pact between Nairobi and Washington has however been beset by delays and uncertainty, casting doubt about the Biden administration’s commitment to concluding the deal.
The Biden administration had earlier called for the objectives of the original bilateral pact signed under the Trump regime to be recast, with some of the objectives of the negotiations set by the Trump administration likely to be dropped.
The Biden administration has instead launched talks on an “investment partnership with Kenya” that seeks non-tariff ways to facilitate trade.
President Biden was looking to move “beyond the old model of free trade agreements and is more geared toward today’s economic realities and the lessons of the last 30 years,” his officials said earlier.
