Team renews hope of reviving stalled Kenya-UK trade treaty

President Kenyatta at Mansion House, the Official Residence of the Lord Mayor of London, where he attended the Kenya-UK Investment Forum on July 27, 2021. [PSCU]

Kenya’s trade deal with the United Kingdom (UK) has inched closer to reality after the State set up a team to negotiate the country’s terms under the Economic Partnership Agreement (EPA).

The team consists of senior officials armed to boost the bilateral trade agreement talks.

In a notice in the Kenya Gazette last week, the Cabinet Secretary for Industrialisation Trade and Enterprise Development Betty Maina announced members to the EPA Council.

They include the Attorney General Kihara Kariuki, the Cabinet Secretaries for the National Treasury Ukur Yatani, the East African Community (EAC) and Regional Development Adan Mohamed and Agriculture, Livestock Fisheries and Cooperatives Peter Munya.

The agreement to establish the EPA between the two countries was signed by Ms Maina and her UK counterpart Ranil Jayawardena on December 8, 2020, to the optimism of the business communities in both countries.

The UK currently takes up a third of all Kenyan exports to the European Union (EU) with the government optimistic the deal will expose Kenya to a Sh20 trillion export market.

“Analysis of the UK market potential for products that have been earmarked for driving Kenya’s national export agenda reveals great opportunity that can only be exploited through assured market access arrangement that is now provided by the EAC/Kenya-UK EPA,” said Ms Maina in a memorandum to MPs explaining the deal last year.

“The market potential that awaits Kenya’s exploitation is estimated at Sh20 trillion against Kenya’s current level of exports, which stands at 0.2 per cent of the total UK market size.”

Alongside the appointment of the members to the EPA Council, the CS also named eight new members to the committee of senior officials to represent the country in the negotiations. 

“Pursuant to the establishment of the committee of senior officials under Article 106 of the EPA between Kenya and the UK of Great Britain and Northern Ireland, Kenya shall be represented on the committee by the Principal Secretary from the Ministry of Planning,” stated the CS in the Gazette notice dated August 30, 2021.

Other committee's senior officials include the Principal Secretaries (PS) for the National Treasury, Foreign Affairs, Industrialisation, Agriculture, Livestock and Fisheries

The Trade and Enterprise Development PS has been named the chair of the Committee. The deal will see Kenya open 82 per cent value of trade to the UK over an extended transition period of up to 25 years with a seven-year moratorium constituting mainly raw materials, capital goods, intermediate products and all other goods.

The deal will also be the first step in negotiating a Fisheries Partnership Agreement (FPA) with the UK in what the State says will unlock the huge potential in Kenya’s fisheries economy.

Earlier this year, Parliament refused to ratify the deal at the last minute, after legislators raised questions about the fine print in the deal with post-Brexit Britain.

“The EPA as presented is copied from the economic partnership agreement that the EAC and the European Union are negotiating on, so is it for Kenya to ratify this deal without other partner States,” asked Dagoretti MP John Kiarie during a special sitting.

Parliament also queried whether the treaty had achieved the threshold of public participation while citing several clauses that have raised concern. In a submission to Parliament opposing the deal, the parliamentary caucus on the economy and business said the UK-Kenya EPA was drafted without a proper economic impact assessment.

“The data that has been used by the government as the basis of negotiating the agreement dates back to 2005,” said the caucus in a letter to Parliament. “Why are we using old EU data to conclude a far-reaching agreement with the UK when Brexit comes with new issues?”