Kenya’s growing trade leadership

In December 2015, Nairobi became the first African capital to host a Ministerial Conference of the World Trade Organisation (WTO) since its founding 20 years ago. This year, Nairobi will once again become the first city – and Kenya, the first country – to host a quadrennial United Nations Conference on Trade and Development (UNCTAD) for the second time since its founding over half a century ago.

UNCTAD 14 will be the first United Nations conference after the milestone adoption of the Sustainable Development Goals, the Addis Ababa Action Agenda and the 21st Conference of the Parties on climate change. When the Tenth Ministerial Conference took place, confidence in any meaningful trade liberalisation outcome through the WTO Doha Round was at its lowest. In fact, talk was rife in Geneva before the conference that Nairobi would sound the death knell for the Doha Round.

The good news is that, after hours of hard work and tough compromises, the final outcome christened the “Nairobi Package” encompasses a host of ministerial decisions on agriculture, cotton and issues related to least developed countries. The most significant decision contains a commitment to abolish export subsidies for farm exports. And so, in many ways, as Cabinet Secretary Amina Mohammed put it at the time, “Nairobi reaffirmed the centrality of the WTO in international trade governance”. UNCTAD 14 will be the first global forum to commit to implementing the 2030 Agenda for Sustainable Development.

There is no doubt that Kenya has today reasserted itself in the global economic governance debate. These international conferences not only position the country as a key leader in shaping the future of trade globally but also confer upon Kenya the onerous responsibility of demonstrating the important role that trade can play in improving people’s lives. Over the last 40 years, average living standards in Kenya have increased five times over – and the bulk of that increase has occurred in the last 10 years, reflecting the country’s burgeoning role as a trade hub for sub-Saharan Africa.

Today, the regional dimension is increasingly important in global trade. Across the world countries are pooling efforts to create more cross-border trade in regional blocs through the North American Free Trade Agreement, the European Union, the Association of Southeast Asian Nations, and now the famous mega-regional agreements: the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership.

Africa should be no exception to this trend. Kenya has a leadership role to play in charting the way forward on increasing intra-African trade. The continental free trade area proposed by African Heads of State is no doubt the right road to follow towards that goal, but it will also be a long journey.

In the immediate future, we should focus our energy on deepening regional integration in the Tripartite Free Trade Area, bringing together the Common Market for Eastern and Southern Africa, the East African Community and the Southern African Development Community. The countries of these three regional communities are diverse enough in their various human and material endowments, yet close enough geographically and institutionally, to quickly become a viable building block for Africa to bring about a continental free trade area.

And reaching an Africa-wide regional agreement among sub regional blocs rather than country by country will also be a more efficient way to harness the growing economic power of individual African countries. Negotiating as a group of countries reduces transaction costs and can lead to swift progress in today’s complicated global trade landscape. During a recent visit to the United Kingdom, United States President Barack Obama cautioned that Britain would “have to go to the back of the queue” in trade negotiations with his country, if they exit the European Union. Negotiating with a big power like the United States is easier and more productive for a regional grouping than a single country. Going it alone in today’s globalized world therefore is simply not an option for African countries – if we want to benefit from the new and growing opportunities of the global market.

The upcoming UNCTAD 14 will be a rare opportunity to highlight how the Tripartite Free Trade Area, and eventually a continental free trade area, can lead to an African mega-regional agreement that can hold its own against other regional blocs around the world. This means not only creating new infrastructure, connecting African countries across borders and seizing the power of technology in Africa’s cities, but also ending the scourge of extreme poverty for the benefit of the next generation, leaving no one behind.

This Conference is a unique moment for Kenya, Africa and the entire world, as it is the first opportunity to agree on the actions needed to achieve the new development agendas, which United Nation’s Member States agreed last year.

The Sustainable Development Goals, the Addis Ababa financing agreement and the Paris climate agreement now need to be implemented, particularly in Africa. UNCTAD 14 is the first step in that implementation process, and a road sign along the way to a more integrated and prosperous Africa free of poverty.