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Hope beckons as Kenya prepares to host Agoa forum

By | July 27th 2009 at 00:00:00 GMT +0300

By Luke Anami

Ten years since the African Growth Opportunity Act (Agoa) was established, Kenya has only taken advantage of about 12 out of 6,500 export products.

Concerns abound, the country has failed to diversify the range of its exports.

Kenya’s exports are relatively lower priced goods such as tea, coffee, textiles, apparels, pyrethrum, handicrafts and processed nuts.

"US agencies such as Usaid are willing to collaborate with Kenyan authorities in building trade capacity and developing business plans to boost export business to the US," Ms Phyllis Shearer Jones, the President and CEO of Elan International LLC said in a video conference held last week at the US embassy.

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"Even though Kenya has local and regional constraints, which the Government is keen on addressing, there is need to build trade capacity to equip business people," she said.

Jones, a former Assistant US Trade Representative for Inter-governmental Affairs and Public Liaison cautioned Kenya would have to handle issues of governance, intellectual property rights, reduce cost of production, tackle insecurity in East Africa, improve its infrastructure and eliminate corruption. The US International Trade Commission reports for last year indicate the success of some Sub-Saharan African governments in achieving stable, more democratic political conditions and an improved economic environment has facilitated domestic and foreign investment, promoting production and export growth.

Investors and tourists

The increased country risk associated with political instability drives away investors and tourists, as was the case with Kenya in last year’s election-related violence.

"Countries where violence is prevalent cannot enjoy benefits brought about by Agoa," she said.

She observed that a dynamic private sector environment with minimal government interference has led to the creation of large- and medium-scale companies in Kenya, which provide stability, technological leadership, a well-trained work force and close linkages with European importers. Kenya’s status as a signatory to the International Union for the Protection of New Varieties of Plants has provided the local industry with better access to new and better plant varieties.

She promised US support in assisting Kenyans build capacity.

Although it will be difficult for Kenya’s agriculture products to access the US market because of stringent measures undertaken by US Development of Agriculture in protecting agriculture products, Jones expects Kenyans to diversify into manufacturing products.

"Whereas Kenya’s apparel products to the US market have increased, competition from countries such as China imply the country works hard to remain competitive," she said.

African Growth Opportunity Act Agoa investors textile industry
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