Kenya and Singapore agree to implement trade, investment treaty

President William Ruto receives Prime Minister of Singapore Lee Hsien Loong at State House, Nairobi on May 18, 2023. [Courtesy, PSCU]

Kenya and Singapore have agreed to operationalize a treaty they signed five years ago to improve trade and investment between the two countries.

The Bilateral Investment Treaty signed in 2018 sought to, among other things, remove double taxation on imported goods but the agreement is yet to come into effect due to a lack of clarity on how this should be done.

President William Ruto, who spoke at State House in Nairobi on Thursday, May 18,2023 after meeting the Prime Minister of Singapore Lee Hsien Loong, said talks on how the agreement will be implemented are currently ongoing and will be completed soon.

"We have agreed that the Bilateral Investment Treaty signed between our nations on 12th June 2018 be operationalized immediately," Ruto said.

He added: "We have directed our respective ministers to conclude negotiations on the Agreement on Avoidance of Double Taxation within the shortest time possible, as we believe this will spark and grow trade and investment between Kenya and Singapore."

The treaty refers to an international agreement allocating taxing rights between the two countries which will help to avoid double taxation.

By implementing the treaty, the two countries expect to be able to avoid double taxation on imported goods, allocate taxing rights and exchange of information on how to expand and grow their markets.

To further boost its partnership with Kenya, Singapore has invited its private sector to consider investment opportunities in Kenya's transport and logistics sectors and explore the potential of Singapore becoming a gateway for Kenya's agricultural products to the ASEAN region.

ASEAN, officially the Association of Southeast Asian Nations, is a political and economic union of 10 member states in Southeast Asia, with an estimated total population of about 668 million.

The two countries have also agreed to actively explore methods of acquiring knowledge and support from Singapore's highly prosperous housing model. This is because 85 per cent of all Singaporeans live in decent and affordable public housing.

Loong is in Kenya on official duty.