Regional instability hampers cross border trade

KAM CEO Tobias Alando, Investment CS Lee Kinyanjui, and United Aryan (EPZ) Ltd chairman Pankaj Bedi during a panel on industrial growth at the opening of the 3rd Kenya Industrialisation Week Conference 2025. [David Gichuru, Standard]

Regional stability has been flagged as a critical tool for intra-Africa trade.

Stakeholders at the 3rd Industrialisation conference have called for peace and cohesion across the East African region, in a bid to rave up cross border trade.

Statistics show that when compared to the rest of the world, cross border trade in Africa is the lowest.

According to Tobias Alando, the Chief executive Kenya Association of manufacturers, regional instability hurts local economies.

In 2024. Kenya exported over Sh60 billion in goods to Tanzania and imported nearly Sh56 billion worth of goods.

“If there is instability in Tanzania, we should not celebrate because Tanzania is a market for our goods. We all rely on each other as a region,” Tobias Alando said.

The Cabinet secretary for Trade and Investment Lee Kinyanjui reiterated the importance of regional stability.

Observing that there are Kenyans in the Neighboring Tanzania, that is currently plagued by post-election violence, Lee Kinyanjui said that “the stability and peace in Tanzania is a matter of great concern to Kenya”.

He notes that there are hopes for things to stabilise, “so Kenya will have a stable environment where both trade and investment can happen without interruptions”.

He has said that the chaos in Tanzania causing trade instability do not reflect long term dynamics for the region.

With economic growth hovering at 5 to 6 per cent, the Cabinet secretary has estimated that it could take 50 years to absorb the country's youth population into meaningful employment unless radical policy shifts are employed to accelerate sustainable industrial jobs.

Speaking at the conference, CS Trade highlighted manufacturing as the cornerstone of long-term employment, forex earnings, and economic stability.

The sector is however pressed by import dominance, value chain weaknesses, financing hurdles, and regional trade barriers which continue to undermine progress.

The ministry of trade has challenged stakeholders to deepen local content so that more value stays within Kenya’s economy, accelerate AI and digital adoption among SMEs to enhance productivity and innovation and expand green industrial finance, blending concessional, catalytic and private funds.

“We should also strengthen public–private collaboration on skills, standards, and industrial research and development,” Kinyanjui said.

The trade agreements Kenya has entered into, and the bilateral conversations that are going on, the CS says, presents a huge opportunity for the industries in Kenya. 

“We want to take the opportunity to open up the COMESA markets. This is a huge market where we can sell our products, open borders so that our people can trade in the political area,” he said.

To ensure ease of cross border logistics at border points, the government says they have aligned the border crossing and reduced the bureaucracy therein.

The CS has noted that delays at the border are obstacles for trade and industry.

Border delays in the East African Community (EAC), Kenya’s top market have been blamed for holding up exports.

According to CS for trade Lee Kinyanjui, recent reforms target one hour clearances.

While encouraging more local investments in the manufacturing sector the CS has said, "we don't want Kenya as an easy market for foreign goods ignoring locals".

He has called for coordinated action on policies, finance, and skills, adding that failure risks perpetuating import-driven fragility, youth despair, and lost potential in a continent ripe for industrial leadership.