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Kenya in last-ditch effort to persuade Tanzania to sign EPA

By Dominic Omondi | Published Thu, September 28th 2017 at 00:00, Updated September 27th 2017 at 22:54 GMT +3
Kenya Horticultural Exporters staff sort out vegetables for export. Kenya's exports to the EU stand to attract additional taxes in absence of the renegotiated Economic Partnership Agreement. [David Gichuru, Standard]

Kenya will today take its case to the European Union in Brussels in a last-ditch effort to garner support for the Economic Partnership Agreement deal.

Trade Cabinet Secretary Adan Mohamed is leading a Kenyan delegation to the Belgian capital, where he hopes to bring Tanzania on board to take a united stand with its East African Community (EAC) neighbours on the elusive trade pact.

The delegation will take part in a session of EAC trade ministers with the EU presidency.

Ugandan President Yoweri Museveni, who is the current chairman of the EAC Summit, is leading the regional delegation.

“Kenya and Rwanda signed the EPA in August 2015, with Kenya ratifying the same in September last year. The move by Kenya was aimed at securing Kenya’s duty-free, quota-free market access in the EU as Kenya along with other EAC partner states seek a solution for all to sign the EPA,” said the CS yesterday in a statement.

The EAC Summit held on May 20 this year mandated the chairman to engage with the EU to address concerns that some partner states have on signing the Economic Partnership Agreement (EPA) as a bloc.

Main opposer

Kenya has put up a spirited fight to have all EAC countries support the EPA as a way of safeguarding unlimited duty-free access of its exports to Europe. The agreement would guarantee EAC traders duty and quota-free access to the EU market in exchange for the gradual opening up of up to 80 per cent of the region’s market to European products.

Tanzania, the main opposer of the deal, has cited the economic and constitutional uncertainties arising from Brexit as the main reason for rejecting it.

President John Magufuli has further argued that opening up the country’s markets to EU products could hurt its fledgeling industries.

Kenya and Rwanda have already signed the agreement, with the former even ratifying it.

The Economic Partnership Agreement has to be signed and ratified by all the EAC member states. Should the deal fall through, Kenya, a middle-income economy, would be the biggest loser as the other EAC states are still classified as Least Developed Countries (LDCs) that can still access the European market duty-free quota-free.

The signing of the EPA between the EU and the EAC was supposed to have been ratified in October last year, but the fallout with Tanzania stalled the process. The decision by Dar to bolt out of the deal leaves Kenya’s exports exposed to heavy taxation - estimated to range between eight and 12 per cent of their value.

Kenya exports tea, coffee, and flowers to the 28-member EU market, which has lately been pushed into a fire-fighting mode after Britain voted to leave the trading block.

Stalled process

The poorest countries such as Tanzania already enjoy duty-free and quota-free access to the EU under an initiative called 'Everything But Arms'.

Should Kenya miss out on the EPAs, trade between it and Europe would be reverted to the less generous market access terms under the General System of Preference (GSP).


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