Kenyan businesses brace for US tariffs impact

Trade, Investments and Industry Cabinet Secretary Lee Kinyanjui at Serena Hotel, Nairobi on March 27, 2025. [David Gichuru, Standard] Kenyan exporters to the US will face higher costs as a new 10 percent tariff takes effect. Trade Cabinet Secretary Lee Kinyanjui said the government is working to expand production, improve infrastructure and technology, and invest in skills development to meet new demand. "The major challenge posed by the US reciprocal tariff is the increased costs for Kenyan exports. While the 10 percent tariff is lower than the competitors' tariffs, it still raises costs for Kenyan businesses exporting to the US," stated Kinyanjui. The tariff is part of US President Donald Trump's broader trade policy targeting 185 countries. The move is expected to affect Kenya's trade with America, which was valued at Sh193.5 billion in 2024. With the tariffs set to take effect on April 9, Kenyan businesses are scrambling to assess the financial impact and explore alternative markets. Kinyanjui pointed to Kenya's textile industry as a potential beneficiary, as steeper tariff hikes on other exporting nations could make Kenyan products more attractive to US buyers. "There is a great opportunity to diversify our exports. We can tap into industries such as apparel, leather, and agro-processing to fill gaps left by higher tariffs on other suppliers," he said. The Ministry of Foreign Affairs is collaborating with stakeholders to identify high-potential products and attract targeted investments. Kenya has long benefited from duty-free access to the US under the African Growth and Opportunity Act (AGOA), but the new tariffs now change the equation. In 2024, Kenya's exports to the US totaled Sh193.5 billion-a 17.5 percent decline from 2023, mainly consisting of apparel, coffee, and tea. Meanwhile, imports from the US surged by 61.4 percent to Sh101 billion. While Kenya faces a 10 percent tariff, Nigeria will be hit with 14 percent, Malawi 17 percent, and Zimbabwe 18 percent. Lesotho, which the White House claims imposes a 99 percent tariff on US goods, will face a 50 percent reciprocal tariff. The timing of the measures is critical, with AGOA set to expire in September this year. Since 2000, AGOA has allowed duty-free access for many African products into the US, but the new tariffs add uncertainty to trade negotiations and Kenya's economic outlook. The Trump administration has defended the decision, citing trade imbalances, currency manipulation, and restrictive trade barriers imposed by other countries.

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Trade, Investments and Industry Cabinet Secretary Lee Kinyanjui at Serena Hotel, Nairobi on March 27, 2025. [David Gichuru, Standard]

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Kenyan businesses brace for US tariffs impact

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