Kenya has made a direct formal appeal to the United States to reverse the 10 percent tariff on exports to preserve duty-free exports for tens of products from the country and protect more than 65,000 jobs.
Trade Cabinet Secretary Lee Kinyanjui said Nairobi has received a positive initial response from Washington following the appeal.
Negotiations are progressing, he added, citing bilateral talks this week in Washington between Kenya’s Prime Cabinet Secretary and CS for Foreign Affairs Musalia Mudavadi and US Secretary of State Marco Rubio on the invitation of President Donald Trump’s administration.
Mr Trump on April 2 invoked the International Emergency Economic Powers Act (IEEPA) to impose a 10 percent baseline tariff on all US trading partners tariffs in a bid to address “the absence of reciprocity in our bilateral trade relationships”.
Washington, however, paused enforcement of tariffs above 10 percent for 90 days from April 10 to allow room for further negotiations, but excluded China from imposing immediate retaliatory taxes.
“We have appealed against that 10 percent [tariff] because we are not at the same level as many developed nations. Conversations are ongoing,” Mr Kinyanjui told Nation Media Group’s Fixing the Nation morning broadcast show.
“We have had a visit to USTR [Office of the United States Trade Representative] and made our appeal that Kenya, because of our geopolitical relations with the United States and other areas where we cooperate, deserves better terms not just on tariff but also on market access.”
Kenya’s exports, largely textiles and macadamia nuts, have since 2000 accessed the American markets tax- and quota-free under the Africa Growth and Opportunity Act (Agoa) deal, which expires in September.
Trade experts said the US tariffs were likely to signal the end of Agoa, which expires in September and had been widely expected to be renewed in some form.
The tariffs sent chills through the global economy, affecting nearly all of Kenya’s trading partners.
Most African countries have relatively small export balances with the US but more significant trade relations with the European Union (EU) and China, JP Morgan said.
Kenya exported Sh88.8 billion in goods to the US last year and shipments of Sh156.9 billion to the EU.
Mr Kinyanjui said the appeal on tariff was part of the bilateral engagement between Nairobi and Washington on Wednesday, the first high-level talks between the two countries since Mr Trump returned to the White House in January.
“I think we are having a good response [on tariff appeal) and currently our Foreign Minister, Musalia Mudavadi, is in Washington to further these conversations. I am sure we will get what we are looking for because Kenya has a strong case,” he said.
“But I think at the end of this, we must also say that our biggest challenge is that even when we get these opportunities, whether in textile or food, we have not been able to fully utilise them. Even when we were at zero [tariff under Agoa], we were able to utilise these opportunities to the extent of 15 to 20 percent, yet we have unemployment and all these issues.”
Mr Mudavadi held talks with Mr Rubio later on Wednesday and the chairman of the Foreign Affairs Committee of the Congress, Brian Mast, marking the Trump administration’s first steps in reviewing security, trade and investment commitments that the former regime of Joe Biden made with Kenya.
“We discussed regional peace and security, expanded trade and investment, and deepened diplomatic engagement,” Mr Mudavadi wrote on his X account.
“We emphasised the need to fast-track the Kenya–US Free Trade Agreement.”
Mr Trump’s administration initiated the trade negotiations with Kenya during his first stint in the Whitehouse in February 2020 under a comprehensive Free Trade Agreement, but this was discontinued by the regime of Joe Biden in favour of a lesser US-Kenya Strategic Trade and Investment Partnership.
The Biden-era STIP talks kicked off in July 2022, but a deal had not been struck by the time he left office with the reams having covered eight rounds of negotiations as at last September.
Latest disclosures from the State Department for Trade indicate the negotiations under STIP were 50 percent done, missing the 2024 target for completion.
The STIP framework was focused on investment and inclusive growth which will benefit workers and businesses in both countries, unlike an FTA framework initiated by Trump’s administration which would have followed a comprehensive traditional market access route, covering areas such as rules of origin and reciprocal removal or reduction in tariffs.
