Kenya hosted the World Trade Organisation’s (WTO) tenth Ministerial Conference, the first time by an African country. And throughout the week, alternative voices punctured muted murmurs of the bureaucrats at the Nairobi talks.
That is notwithstanding the fact that private businesses would evidently benefit the most particularly, if developing countries and the activists have their way. With regard to representation, it is futile for apex bodies to claim they are ‘the voices’ of the private sector yet they were conspicuously inaudible during the entire WTO meeting.
The least they could have done is to coordinate the entire private sector in a manner that would have influenced the government’s position at the conference. What became of their mandate to provide “...leadership and single voice of the private sector on issues of national importance?”
But why should they be concerned about WTO rules; because serious barriers targeting entry of goods from developing countries choke the spirit of complementarity and economies of the affected states. In the case of Kenya, for instance, local manufacturers and businesses are quite vulnerable due to the conditions imposed on our exports by developed countries. In such situations, representatives of the private sector are best placed to temper the voice of the government and ultimately mold its stance.
Perhaps Kenya’s private sector could start by borrowing a leaf from other precedent setting occurrences that share similar backgrounds. Special interest groups from an array of countries campaigned for years ahead of the Uruguay Round trade talks that changed the way the world trades. The pressure leading to this paradigm shift lasted between 1986 and 1994.
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Elsewhere, in the mid 1990s, US and Japan entered a pact that ushered in a favourable tax regime on a number of Japanese luxurious vehicle imports to the US but only after a protracted standoff bordering on diplomatic fallout.
In other words, it will take more than nominal lobbing by a discerning private sector to alter skewed trade regimens that disadvantage weaker nations. Success in installing favourable trade dealings pretty much depends on environments borne of local political realities.
International linkages
Indeed, the Harvard Journal of Political Economy views trade policies of any country as an outgrowth of a political process. These outfits should demand that the government negotiates for status quo that would cater for their interests. As a country, we should vehemently campaign to have our non-agricultural products enter the global market ‘unmolested’ by tariffs and non-tariff barriers imposed by a hawkish West.
Yes, the sector contributes the bulk of export earnings. Others, imposed by the European Union have constrained our horticultural exports. At the same time, Kenya now has so many small and micro-enterprises that need to be included in the international trade value chain. We need to first ‘grow’ them into competitive outfits and provide international linkages, starting with opening up regional markets ahead of going for markets further afield. To address such drawbacks, we need to identify regional and international markets for particular products and services.
To beat WTO rules, we should vigorously boost inter-regional trade as called for by the African Union in 2012. Alongside, it is important to deepen market integration within Africa and cut down our over-reliance on our trade with the industrial countries. As the European Union has shown through the Economic Partnership Agreement (EPA), industrial countries are only interested in having African countries open up their markets to their products. As they do so, they give us a false promise that we will benefit from customs-free access to the European market.
The future of WTO without free trade of agricultural products from Africa for instance is downright unfair. In days to come, Africa should ensure agreements that favour access of non-agricultural products - manufacturing products, fuels and mining products, fish and fish products, and forestry products are put in place.
Arm-twist
This can raise the profile of our non-agricultural products exponentially as shown by the fact that export employment and investment between 2010 and 2014 in the export processing zone in Kenya rose by 17 percent, 12 percent, and 21 percent per year, respectively following the entry of apparel to the US market through Agoa.
Private businesses in Kenya must be alive to the fact that 20 years of reliance on a neo-liberal trade regime has denuded the ability of the country to emerge economically. And just like multinationals ‘arm-twist’ their home countries to negotiate for a system that favours their access to our markets, likewise, the private sector must emerge and be counted.
—The writer chairs the Kenya National Chamber of Commerce and Industry
