•Latest developments in the US where Biden has withdrawn his re-election bid is said to have piled more pressure on the negotiating teams.
•The two countries had hoped to have a deal by December last year but talks spilled into this year.
Image: PCS
Kenya and the US have entered into the seventh negotiating round under the Strategic Trade and Investment Partnership (STIP), as they push for a deal before the November US elections.
This, as they seek to avoid a repeat of previous cases where elections and change of office bearers have slowed down the process, which commenced in July 2020 during former Presidents Donald Trump and Uhuru Kenyatta's tenures.
After the US elections in November 2020, President Joe Bidens’s administration took time to review part of the pact before initiating a fresh round of talks.
Kenya then went into an election in August 2022, which saw then Deputy President William Ruto ascend to power, with his administration taking over the negotiations as the two administrations agreed to seek a Strategic Trade and Investment Partnership.
It has been the wish of the two Presidents to have a deal before end of this year, with the recent developments in the US where Biden has withdrawn his re-election bid piling more pressure on the negotiating teams.
The two countries had hoped to have a deal by December last year but talks stretched into this year.
The seventh round of talks being held in Nairobi commenced on Tuesday, ending today (August 9).
The Kenyan delegation is led by Principal Secretary for Trade Alfred Ombudo K’Ombudo while the US team is led by Assistant US Trade Representative Constance Hamilton.
Negotiators last met in June in Mombasa, Kenya and have continued to make progress across several topics, K'Ombudo affirmed.
"This round of negotiations will primarily cover agriculture, sanitary and phytosanitary measures; customs and trade facilitation; environment; good regulatory practices, inclusive trade; and workers’ rights and protections," he said.
Legal teams from both countries are also present in Nairobi and are proceeding with discovery meetings on the legal, conflict resolution and institutional chapters of the proposed trade agreement.
The two chief negotiators will also co-chair a stakeholder listening session with civil society and business.
During the recent American Chamber of Commerce in Kenya (AmCham) 2024 Business Summit in Nairobi, President Ruto had indicated that a Strategic Trade and Investment Partnership between the two countries should be ready for implementation in the second half of this year.
The Trade ministry had envisioned a deal by October with insiders familiar with the negotiation process putting the progress at 80 per cent.
"It is at the tail end and with the way things are going, it is possible to have a deal by October or even earlier but this year will not end," an official told the Star.
While Kenya enjoys duty free access to the US market under Agoa, which gives up to 6,400 product lines access to the US market, it is keen on the Strategic Trade and Investment Partnership whose talks kicked off in July 14, 2022, to increase investment, promote sustainable and inclusive economic growth.
The change in administrations in both countries has had a significant impact on the process which was mooted in 2020, with was also stalled by the Covid-19 pandemic.
With a bilateral deal, Kenya is keen to tap at least five per cent of the US market, which has the potential to earn the country more than Sh2 trillion in export revenues annually.
Last year, Kenya's exports to the US were valued at Sh62.3 billion, down from Sh79.9 billion, the Economic Survey 2024 indicates.
More than half of Kenyan exports to the US are comprised of textile and apparel, macadamia, coffee, titanium ores and concentrates, and black tea.
Trade however remained in favour of the US as Kenya spent Sh112.8 billion to import goods from the American country, an increase from Sh93.4 billion in 2022.
The agricultural sector, manufacturing, textile, and mining will be among the biggest winners if a deal is struck, with Kenya also keen to rope in SMEs and build up Special Economic Zones and Export Processing Zones for increased exports, as it cuts its import bill.
Kenya is also keen to attract US companies in a Foreign Direct Investment’s drive.
Among sectors Kenya is keen to attract US investments include agriculture, health, ICT, textile, green energy, manufacturing and tourism.
Meanwhile, Kenya is also keen to expand product offering and tap a bigger market under the Agoa deal, which is expected to be extended to 2041.
While Kenya is the second biggest exporter to the US under Agoa, it is yet to maximise on the pact with only the textile and apparel sector enjoying the biggest gains.