EAC & The HornNews

Kenya scores big with duty-free access to the EU market

Starting today, businesses and exporters in Kenya can tap into the $18 trillion European Union market as the two parties announce that the historic deal has entered into force. The EU-Kenya Strategic Partnership now opens duty-free access for all Kenya’s exports to the European Union market, a statement from the Ministry of Investments, Trade and Industry said.

It noted that the deal will “boost bilateral trade in goods, increase investment flows, strengthen the ties between reliable partners, and facilitate mutually advantageous economic relations.”

Policymakers believe that this initiative will also spur economic growth while also opening fresh avenues for job creation.

The landmark initiative, which was concluded in June 2023 and signed by both parties in December last year, is one of the most ambitious deals ever negotiated between the EU and an African country in terms of enhancing economic sustainability.

“The EPA will also create more opportunities for Kenyan businesses and exporters, as it will fully open the EU market for Kenyan products and incentivize EU investment in Kenya thanks to increased legal certainty and stability,” noted the EU

The 27-member bloc added that “Kenya is East Africa’s main economic hub – and EU-Kenya trade relations have substantial growth potential. The agreement will unlock new economic opportunities, as the EU is Kenya’s first export destination and second-largest trading partner. Total trade between the EU and Kenya reached €3 billion in 2023 – an increase of 16 percent compared to 2018.”

According to Trade CS Rebecca Miano, EPA is poised to open more opportunities for Kenyan businesses and exporters including high-value manufactured products as it will fully open the EU market for locally made products while also incentivizing EU investments in East Africa’s largest economy.

This agreement also contains strong trade and sustainability commitments by both parties, such as binding provisions on labour, gender equality, and environmental protection as well as measures to fight against the impact of climate change.

Read also: Kenya moves closer to gaining duty-free access to EU markets

Horticultural products

At the moment, the bulk of Kenya’s exports to the EU are horticultural products including fresh produce and cut flowers, and the deal is set to enhance Kenya’s reach in this vast market.

The EPAS are global agreements that do not expire implying that both the free access of Kenya into the EU market without limit and the long-term free access of EU products to the Kenyan market is likely to increase incentives to invest in Kenya.

In the deal however, Kenya decided to exclude from liberalization various agricultural products such as wines and spirits, chemicals, plastics, wood-based paper, textiles and clothing, footware, ceramic products, glassware, articles of base metal and vehicles.

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