Kenya engages US to safeguard exports amid Trump's tariff war

Kenya has started talks with the US government in an anticipatory move aimed at protecting the country’s largest export market, following President Donald Trump’s tariffs rollout.

Investments, Trade and Industry Cabinet Secretary Lee Kinyanjui, disclosed that the government will meet with a team of policymakers from the US this week to discuss the issue.

He said Kenya is keen to protect its textile exports to the country. The US is the largest trading partner with Kenya outside of the East African Community (EAC), in terms of value of exports.

According to the Kenya National Bureau of Statistics (KNBS) 2023 Economic Survey, Kenya’s exports to America stood at Sh79.9 billion in 2022. The Netherlands is Kenya’s second export market outside of EAC, valued at Sh69.7 billion, with the United Kingdom coming third with Sh44.6 billion.

Globally, Uganda is Kenya’s largest trading partner with ="https://www.standardmedia.co.ke/business/business/article/2001511637/kenya-exports-over-4-200-tonnes-of-flowers-ahead-of-valentine">Sh97.2 billion worth of exports< traded in 2022. The ascension to office of President Trump, however, has raised fears not only for Kenya but the rest of the world as the leader of the free world proves determination to protect industries in his turf by slapping imports with 25 per cent tariffs.

Automobiles are the latest products slapped with the tariff, with communication from the White House arguing that foreign automobile industries have benefited from unfair subsidies and aggressive policies while US production has stagnated.

“These new tariffs aim to ensure the US can sustain its domestic industrial base and meet national security needs,” reads the communication from the White House.

Imports to the US from Canada, Mexico and China have already seen these tariffs imposed. The US imports a lot of textiles and apparel from China.

CS Kinyanjui, while addressing industry players in the manufacturing sector, said the ongoing conversation on tariff has necessitated the country to ="https://www.standardmedia.co.ke/business/amp/opinion/article/2001508451/diversifying-kenyas-exports-for-economic-prosperity">put its best case forward<.

“There is a lot of tariff conversation going on, and as a country, we will put our best case forward with the US. Next week (this week), we are having a conversation with policy makers on that side so that our textile industry can be protected,” he said.

Major stores in the US, such as H&M and JCPenney, source their fabric from Kenya, courtesy of the government’s preferential taxes on Export Processing Zones, where the manufacturing takes place.

Kenya exports its textile and apparel through the African Growth and Opportunity Act (Agoa), which allows select countries on the continent to access the US market duty-free.

This deal, however expires in September with discussions underway on how to extend it.

Industry Principal Secretary Dr Juma Mukhwana has however lamented on ="https://www.standardmedia.co.ke/main-staging/counties/article/2001500638/kenya-us-negotiate-new-trade-partnership-as-agoa-nears-end">underutilisation of the agreement< despite how costly it is to negotiate such trade deals. “Part of the discussion here is yes, the government is doing its part in negotiating these agreements, but what is going to happen under these agreements?”