Kenya has been assured that Washington will ratify two crucial trade deals ahead of the November 5 presidential election in the United States, the Trade Ministry has told Parliament.
Juma Mukhwana, the Industry Principal Secretary told the National Assembly’s Departmental Committee on Trade, Industry and Cooperatives that US lawmakers will approve the extension of the African Growth Opportunity Act (Agoa) and the US-Kenya Strategic Trade and Investment Partnership (STIP) agreement.
Kenya is seeking an extension of the Agoa pact, first enacted in 2000 before renewal for 10 years in June 2015. The deal is due to expire next year with President Joe Biden’s administration keen to extend it to 2041.
The pact allows duty- and quota-free access to the US for thousands of products like food and beverages, wood, plastics, and rubber from sub-Saharan Africa, but Kenya has largely tapped the apparel line.
“The Bill on the extension of Agoa is currently before the US Congress. We have very good relations with the US, and we are confident that Agoa will be renewed before a change of government in the US,” Dr Mukhwana said.
“This matter is in the US Congress and we have been assured that before October, the Agoa Bill will be done.”
The current trade negotiations have been led by a Democratic administration and there are concerns that a possible change in government –to a Republican administration– could upend the agreements.
Dr Mukhwana told MPs that the government has also been assured that the STIP agreement will be concluded and signed before the exit of President Joe Biden’s administration.
“Agoa and STIP will be renewed and signed respectively. We are aware that a new government will come in and take power in the US,” he said.
Dr Mukhwana appeared before the committee alongside Abubakar Hassan, the Principal Secretary for Investment Promotion to appraise MPs on the measures being taken to boost the manufacturing sector in Kenya.
The committee chaired by Embakasi North MP James Gakuya also wanted to know the measures the government is taking to promote value addition and diversification within key manufacturing sectors, support for small and medium enterprises (SMEs) and cottage industries as well as measures to address infrastructure deficiencies and high cost of production that hinder manufacturing productivity.
Kenya is rushing against time to have the two crucial trade deals with the US inked to avoid falling back to square one if Republicans take power in Washington.
The US is due to hold presidential elections by November 5 this year, pitying Vice President Kamala Harris of the Democratic Party and former President Donald Trump of the Republican Party.
The US Congress has put down proposals that would see Agoa extended to 2041, thus remaining in effect for 16 years.
Senators Chris Coons (Democrat-Delaware) and James Risch (Republican-Idaho) in April this year introduced the bipartisan Agoa Renewal and Improvement Act of 2024, which would see Agoa cover 54 out of the previous 32 African countries.
The extension is expected to integrate Agoa with the African Continental Free Trade Area to support the development of intra-African supply chains.
Kenya has long sought a sustainable full free trade agreement with the US outside of the two-decade-old Agoa deal, but progress has been dragged by regime change in both countries.
The two countries are locked in negotiations under STIP whose terms Kenya and the US started stitching together in July 2022 before the end of former President Uhuru Kenyatta’s term in office.
The 11 chapters focus on agriculture, anti-corruption, digital trade, environment and climate action, good regulatory practices, and micro, small, and medium-sized enterprises.
The STIP was supposed to be a “high standard commitment” in a wide range of areas meant to increase investment, promote sustainable and inclusive economic growth, benefit workers, consumers, and businesses and support African regional economic integration.
The STIP was also supposed to address worker’s rights and protections, participation of women, youth, and others in trade, standards collaboration, trade facilitation, and customs procedures, and services domestic regulation. Kenya and the US held the seventh round of negotiations on August 5 under STIP where eight chapters were discussed. The negotiations are co-chaired by Assistant US Trade Representative for Africa Constance Hamilton and Kenya’s Trade Principal Secretary Alfred K’Ombudo.
